Reporting Will Enable Treasury to Boost Accountability for $10 Billion State Small Business Credit Initiative Program’s Equity Commitments
WASHINGTON – Today, the U.S. Department of the Treasury launched a historic demographic information collection effort to measure equity outcomes for small businesses supported by the State Small Business Credit Initiative (SSBCI) program. The information collected by Treasury will support the program’s commitment to expanding access to capital for businesses owned and controlled by socially and economically disadvantaged individuals (SEDI businesses).
The American Rescue Plan Act of 2021 included $10 billion for SSBCI to provide to states, the District of Columbia, territories, and Tribal governments for programs that help small businesses access capital, including $2.5 billion in allocations to support SEDI businesses. SSBCI will provide recipient jurisdictions funding for a range of programs that will increase access to credit for small businesses, including through lending and equity capital investments, to help businesses grow in the years ahead. Treasury’s implementation of the SSBCI program is designed to expand access to capital, promote economic resiliency, and create new jobs and economic opportunity.
“Treasury is committed to promoting a strong and equitable economic recovery from the pandemic, and reliable, comprehensive data is a critical part of measuring our success in doing so,” said Deputy Secretary Wally Adeyemo. “The State Small Business Credit Initiative program’s design is intended to help remedy the unfortunate reality that underserved communities have historically faced greater barriers to accessing capital than others, preventing them from pursuing their business ideas and ambitions. This new reporting will give Treasury the information we need to assess the impact of this program in communities across the country and work to provide these communities with the capital they need to realize their entrepreneurial visions.”
Jurisdictions participating in SSBCI will report demographic information collected from small businesses that receive capital through the SSBCI program, including data on race, ethnicity, sexual orientation, and gender identity. The data collected is essential to measuring the impact of SSBCI capital and aligns with Treasury’s commitment to promote economic growth by investing in the communities and businesses that are most in need of resources. The information collection will aid jurisdictions looking to attract additional investment by demonstrating strong performance in the investment in SEDI businesses.
Advancing equity has been a key priority of the Biden-Harris Administration, including through its implementation of the American Rescue Plan. This includes efforts to support small business growth and expand access to capital to communities across the country to ensure an equitable economic recovery. SSBCI funding is expected to catalyze up to $10 of private financing for every $1 of SSBCI funding, amplifying the effects of this funding, and providing small business owners with the resources they need to sustainably grow and thrive.
Treasury has received SSBCI applications from all states, territories, and the District of Columbia, covering over 200 unique financing programs and over $8.3 billion in funding. Treasury is currently reviewing the applications for approval. Treasury will continue engaging with jurisdictions to help develop sustainable programs that will promote long-term growth in their communities.