Heard on the Street: why CDFIs need equity investments, no forgiveness for many small businesses, and a new grant program for Cook Co

By September 28, 2020 Heard on the Street

Heard on the Street – here’s what we were reading last week:

Cook County plans to give out grants of up to $10,000 to small businesses hit hard by pandemic: A small-business assistance program will give to businesses a total of $12.6 million in federal CARES Act money. The county aims to serve about 1,200 businesses. The program also will funnel $2.4 million into a free advising and education service for business owners throughout Cook County, including Chicago, that seek direction on how to weather the pandemic.

Corporate deposits in CDFIs are good. Equity investments would be even better.: CDFIs are having a moment – finally being recognized for their critical role in supporting low-wealth communities. Taking the relationship to the next level requires real commitment. For a CDFI, that means equity – equity in the form of common or preferred stock for CDFI banks, secondary capital investments for credit unions, and grant capital or long-term subordinated debt investments for loan funds.

No forgiveness: Small businesses still on hook for rescue loans: Lenders that helped the government deliver the money are warning that the effort is running into new delays and complications that could leave struggling employers on the hook with unanticipated debt.

81% Say the 2020 Election Will Affect Their Small Business, No Matter the Outcome: A majority of small business owners say despite the winner of the November presidential elections they will be impacted in any event. A whopping 81% say the election will impact businesses while 57% say it will impact their own business’ financial security. This is irrespective of which way owners are planning to vote.