ST THOMAS, USVI -- The VI Economic Development Authority (VIEDA) has approved 24 loan guarantee support applications in the amount of $3 million to help local small businesses through local banks that are participants of the state small business credit initiative (SSBCI) program in the US Virgin Islands.
At the end of the third quarter of fiscal year 2014, VIEDA’s statistics revealed that the approval of these loan guarantee support applications between January 20, 2012, and June 30, 2014, have helped local small businesses get access to funding to help them sustain, or grow, their business. These approvals saved 215 jobs and created 37 new jobs in the Territory.
VIEDA, which has been designated by Governor John deJongh to administer this program in the US Virgin Islands, currently guarantees up to 50 percent of the total loan amount applied for at SSBCI participating banks in the USVI by local small business owners.
According to VIEDA's chief executive officer Percival Clouden, "One of the main reasons small businesses fail is due to their lack of access to capital. Through our partnerships with local banks that are participants of the SSBCI, the VIEDA is committed to ensuring that local small businesses get access to the funding they need to operate their business while they retain and hire employees."
Under the USVI’s SSBCI program, loan guarantees enable small businesses to obtain term loans or lines-of credit. If approved, the VIEDA provides banks with a percentage guarantee as security for the loan or line of credit. The USVI’s SSBCI loan enhancement programs include the collateral support program; credit guarantee program; and the payment, surety, and performance bond program.
The USVI SSBCI program is a loan and bonding program that is designed to help create and grow small businesses, and create jobs and tax revenues for the US Virgin Islands.
The SSBCI is a federal loan guarantee program under the US Department of the Treasury, which was funded with $1.5 billion to strengthen state programs that support private financing to small businesses and small manufacturers. In 2011, the USVI was awarded $13.1 million from the US Department of the Treasury as a participating state under the SSBCI program that was established by the Small Business Jobs Act of 2010. The SSBCI program represents a significant change in the federal approach to economic development.
In May 2014, state directors and other officials from SSBCI programs representing 48 states, Washington D.C., and four territories -- including the US Virgin Islands -- gathered in Washington for the fourth national SSBCI conference where attendees shared insights, success stories, and best practices. Across the nation, SSBCI has already disbursed more than $1 billion of nearly $1.5 billion in funds, according to the US Department of the Treasury.