Program Will Increase Access to Affordable Loans for Veteran-Owned Businesses
June 8, 2018 – Bank of America today announced a $20 million Veteran Entrepreneur Lending Program to connect U.S. military veteran business owners with affordable capital to help kick-start and grow their businesses.
“Helping our veterans translate their skills and become entrepreneurs driving the U.S. economy is one of the ways Bank of America is thanking them for their service,” said Chief Executive Officer Brian Moynihan.
Loans will be administered through participating community development financial institutions (CDFIs) – nonprofit institutions with expertise in lending to small businesses and an understanding of local circumstances, including economic development and job creation opportunities. In addition to deploying capital, the Bank of America Charitable Foundation is providing $1.3 million in grants over two years to help CDFIs manage operating costs.
Each year, more than 200,000 U.S. service members return to civilian life, including 10 percent with a desire to own a business, creating a pipeline of potential borrowers. Additionally, there are more than 2.5 million businesses in the U.S. that are majority-owned by veterans. Of those, more than 440,000 veteran-owned businesses have employees1, which helps drive economic growth and job creation in local communities. The lending program will kick off in seven U.S. states with the following CDFIs administering the loans and offering an interest rate reduction on loans for qualifying borrowers:
- Carolina Small Business Development Fund – North and South Carolina.
- Colorado Enterprise Fund – Colorado.
- Excelsior Growth Fund (an affiliate of New York Business Development Corporation) – New York.
- Main Street Launch – California.
- PeopleFund – Texas and Oklahoma.
Prior to receiving a loan, borrowers will participate in a two-month training program led by learning partners – IVMF at Syracuse University, Veterans Entrepreneurship Program at Oklahoma State University, and VETToCEO by Veterans for Veterans – offering technical assistance and other resources to help borrowers stay on a path of success and grow their businesses.
Entrepreneur Marc Smith, an Army veteran and owner of Patriotic Pig BBQ in Texas, illustrates the impact of this program. Smith and his wife Gina own and operate a BBQ catering company located in Dallas, with a mission to source local food and give back to the veteran community. The Smiths used working capital to buy a large military-themed smoker, which enables them to serve four times as many customers – about 1,000 customers each weekend. With the help of 10 employees, the Smiths’ catering business accommodates up to five barn- and rustic-style weddings per day, with plans to grow in the future.
“We started the business in 2016 and to see it continually grow since then has been incredibly rewarding,” said Smith. “Being able to get a loan was a game-changer and an important factor in our ability to grow our business. We’re thankful and plan to pay it forward by using the smoker on Veterans Day and feeding local veterans.”
Today, Bank of America will host a thought leadership event, “Empowering Small Businesses to Drive Economic Growth,” on Capitol Hill, including a discussion about the role of small business in the U.S. economy and the opportunities and challenges small business owners and veteran entrepreneurs face in a time of rapid change. Featured speakers include Bank of America CEO Brian Moynihan, SBA Associate Administrator Bill Manger, and Bank of America Head of Small Business Sharon Miller.
Bank of America is the largest investor in CDFIs, with $1.6 billion in financing to more than 260 CDFIs across all 50 U.S. states and the District of Columbia.
Bank of America
Bank of America is one of the world’s leading financial institutions, serving individual consumers, small and middle-market businesses and large corporations with a full range of banking, investing, asset management and other financial and risk management products and services. The company provides unmatched convenience in the United States, serving approximately 47 million consumer and small business relationships with approximately 4,400 retail financial centers, approximately 16,000 ATMs, and award-winning digital banking with approximately 36 million active users, including 25 million mobile users. Bank of America is a global leader in wealth management, corporate and investment banking and trading across a broad range of asset classes, serving corporations, governments, institutions and individuals around the world. Bank of America offers industry-leading support to approximately 3 million small business owners through a suite of innovative, easy-to-use online products and services. The company serves clients through operations across the United States, its territories and more than 35 countries. Bank of America Corporation stock (NYSE: BAC) is listed on the New York Stock Exchange.
SOURCE: Bank of America