New York City Mayor Eric Adams on Monday will announce a new partnership with Goldman Sachs Group Inc. and Mastercard Inc. that will create the largest public-private loan fund for small businesses in the city’s history.
(Bloomberg) — New York City Mayor Eric Adams on Monday will announce a new partnership with Goldman Sachs Group Inc. and Mastercard Inc. that will create the largest public-private loan fund for small businesses in the city’s history.
The $75 million NYC Small Business Opportunity Fund will offer businesses loans ranging from $2,000 to $250,000 at a fixed below-market interest rate of 4%, regardless of the loan size. The program comes as many small businesses that struggled to stay open during the pandemic are still fighting to bounce back.
“Small businesses throughout our city have been disproportionately impacted by the Covid-19 pandemic, and helping them get back on their feet is critical to an equitable recovery,” Adams said in a statement.
More than 4,000 private businesses, including chain stores and retail banks, shuttered in New York from 2019 to 2021 during the height of the pandemic, the city comptroller’s office said. About 1,500 local businesses will be able to apply for the new loans, exempt from credit score minimums and application fees, according to the city.
Christine Noh, owner of the apparel store Nohble, which was founded in 1982 by her parents, said the past three years have been a tremendous challenge. Noh said she feels like she is constantly trying to recover from whiplash. Although she received a loan from a city program designed to keep businesses afloat during the pandemic, she told Bloomberg in an interview that she plans to apply for the new loan.
“New York City is a very challenging place to operate, and it only gets more expensive to operate, it never gets cheaper and more of this is needed, I would say I am somebody who is very well engaged and even then, I don’t necessarily know what products are being offered or what programs may exist,” Noh said.
To qualify for the loan, businesses must have less than $5 million in revenue. Borrowers can also use the loan to refinance higher-interest debt.
Goldman Sachs is contributing approximately $50 million to the loan program, while Mastercard is giving $500,000 for outreach and educating small business owners. The balance of the program’s funds will come from New York City. The partnership will also work with local groups including Community Reinvestment Fund and local Community Development Financial Institutions, which are dedicated to serving low-income people or businesses.
“Small businesses are the engines of our economy,” Maria Torres-Springer, deputy mayor for economic and workforce development, said in a statement. “This innovative public-private partnership will not just help over one thousand businesses, but will have lasting ripple effects in the lives of workers and in the health of our neighborhoods where these businesses operate.”
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