Louisiana has new loan program for small businesses hurt by COVID-19
On Wednesday, Gov. John Bel Edwards announced a new Louisiana Loan Portfolio Guaranty Program, which will offer loans of up to $100,000 to Louisiana small businesses of fewer than 100 employees that are impacted by the COVID-19 crisis.
To help Main Street and rural businesses sustain operations, the loans will require no payments for 180 days and carry below-market interest rates of no more than 3.5%.
The Loan Portfolio Guaranty Program, or LPGP, is a partnership of Louisiana Economic Development, which will provide a loan guaranty fund; the Louisiana Bankers Association, whose membership will provide the loans; and the Louisiana Public Facilities Authority, which will administer the program.
A total loan pool of $50 million will be quickly disbursed to eligible small businesses across Louisiana.
The Louisiana loan program partners envision helping small businesses meet critical needs for operating their firms during and beyond the disruption of the COVID-19 pandemic.
LPGP loans will provide up to $100,000 in immediate financing to help small firms impacted by COVID-19 meet their payroll, retain employees, pay their rent and mortgages, and keep their lights on and their doors open. Interested businesses may find loan details at OpportunityLouisiana.com/covid19, and a list of participating bankers will be posted at the site by Friday as banks complete their participation agreements.
“Louisiana banks play an important role in economic activity, and continue to do so during disaster recovery,” said Louisiana Bankers Association CEO Robert Taylor. “The work Louisiana Economic Development and the Louisiana Public Facilities Authority have done on this loan guaranty program for small businesses is great. We appreciate the opportunity to get the program details out to all the bankers in the state. The can-do spirit of everyone involved has been very positive.”
“The LPFA has an extensive history of assisting the State of Louisiana in some of its most challenging times,” said President and CEO James W. Parks II of the Louisiana Public Facilities Authority. “I am pleased that LPFA’s experience and capacity has allowed us to quickly bring this program forward. Access to funding for Louisiana businesses is a priority, and by working with our Louisiana banking community we can make loan decisions here in Louisiana. This state guaranty program will leverage available funds and enhance eligibility.”
Through the program, bankers will have the flexibility to extend loan terms for up to five years, while interest rates will be below conventional commercial lending rates and no higher than 3.5 percent. To date, participating banks have requested allocations for about two-thirds of the $50 million in loan capacity available through LPGP.
Other lenders interested in participating should contact LED by calling Business Development Manager Kelly Raney at 225.342.0411 or by emailing LEDSmallbizloans@la.gov.