More than 1,000 loans were made over past several months, starting in April
7/24/2020 7:40:59 AM
St. Paul – The Minnesota Department of Employment and Economic Development (DEED) announced that 1,020 small businesses throughout Minnesota received a Small Business Emergency Loan, which is different than the more recently announced Small Business Relief Grants. More than $27 million in loans were made from $30 million in special revenue funds allocated to the emergency loan program. The remaining $2.8 million was distributed to lenders to assist with loan administration and technical assistance expenses. DEED worked with lenders throughout Minnesota to implement the emergency loan program, which opened for applications in late March. Loans were issued to qualified businesses beginning in April and completed by June 30.
"Small Business Emergency Loans helped hundreds of businesses across Minnesota survive the initial impacts of the COVID-19 pandemic," said DEED Commissioner Steve Grove. "DEED launched this program in record time to get emergency financial assistance out to businesses as quickly as possible. We could not have done this without the hard work and collaboration of our 22 lending partners throughout the state."
Loans were made by DEED's lender network for amounts between $2,500 and $35,000 to qualifying small businesses whose owners who lacked adequate cash flow to withstand temporary closure. The 0% interest loans are up to 50% forgivable if the business maintains operations at substantially the same level as before the pandemic. Because these loans are considered bridge financing, if other financing becomes available to small businesses that received a Minnesota Small Business Emergency Loan, such as federal funding, the emergency loan must be repaid.
The emergency loans went to help businesses temporarily closed under Executive Order 20-04, later clarified by Executive Order 20-08, which stopped onsite customer dining at restaurants and bars and closed salons, tattoo parlors and other personal care businesses. Under Minnesota's phased Stay Safe plan, restaurants and bars have reopened for onsite customer dining and salons and other personal care businesses reopened for service.
The Minnesota Small Business Emergency Loan Program is part of a slate of emergency financing options for small Minnesota businesses. Other state options included the Small Business Loan Guarantee program and the Small Business Relief Grant program. State programs complement much larger federal government programs, including Small Business Administration assistance, and the Paycheck Protection Program.
The loans were made throughout Minnesota with business in the seven-county metro receiving $13.2 million in loans and businesses in Greater Minnesota receiving $14.0 million. A demographic breakout of ownership of businesses receiving loans will be available later this year.
You can see a list of businesses that received a Minnesota Small Business Emergency Loan, as well as a breakout of loans by region and lender, on DEED's website.
DEED is the state’s main economic development agency, promoting business recruitment, expansion and retention, workforce development, international trade and community development for more details about the agency and its services, visit the DEED website or follow DEED on Twitter.