Jun. 10—Chattanooga's economic recovery from the coronavirus pandemic is getting a boost from a new loan program designed to aid the start up and growth of minority-owned entrepreneurs and growing businesses in low-income parts of
“This is the first time in our 21-year history where we've seen foundations, banks and the community really come together to help promote entrepreneurship,” said
The new initiative is targeting making at least 40% of its loans to minority-owned businesses, nearly triple the current statewide average for small businesses owned by people of color.
Pathway Lending uses both its business assistance and access to capital to broaden lending programs to more low-income communities and to serve more persons of color under its slogan “No opportunity missed.” The lending program has succeeded so far in limiting loan losses to only about 1.8% even though it specializes in non-collaterized loans that most bank or even the
“We're one of the few places where capital and capacity building come together,” Gwin said. “We will be working with our ecosystem partners here like Co.Lab, the
But for all the success of Pathway Lending since its start in 1999, even Gwin concedes he was challenged when former LaunchTN CEO
“The path to shared prosperity and an equitable recovery in
Gwin said the racial wealth gap in America often makes it harder for people of color to have home equity or friends and family members to support their startup efforts. Pathway Lending helps offset such disparities and grow businesses into successful ventures that then qualify for traditional bank loans and other outside investments.
“Now more than ever, it's important to have funding in place to meet needs and grow efforts to support the vision of small business owners and entrepreneurs, and there's simply no better place than
The investing banks get Community Reinvestment Act credit for their loans to Pathway Lending as well as franchise and excise tax advantages that
Brock said Pathway Lending has been one of the most successful of the 17 CDFIs in
Chatter Box, a barbecue eatery started by
“We were able to triple our revenues last year when a lot of restaurants were closed and we're hoping this addition will help us grow even more this year,” Ellis said.
“Pathway brings a huge new toolbox to the
The loans by Pathway Lending will range from
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