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Marlborough FinCom OK's $100K transfer for small business loan program

WICKED LOCAL MARLBOROUGH – The Finance Committee this week signed off on a $100,000 budget transfer to create a revolving loan fund economic development officials say will help strengthen the city’s small business base.

Described by Tim Cummings, executive director of the Marlborough Economic Development Corporation, as “a proven best practice,” the revolving loan fund would provide gap financing for prospective entrepreneurs to launch new companies and existing business owners to expand and create jobs.

The funds from the program would fill the gap between loans businesses obtain from banks and the total amount they need to launch or grow, said Cummings.

Cummings and the Marlborough Economic Development Corporation spearheaded the loan program because many smaller companies were having difficulty getting loans from banks, making it nearly impossible for them to grow and expand. Many local business owners told Cummings they needed flexible lending programs that offer a low interest rate or a deferred payback schedule.

Saying the proposed loan program could help attract more small business owners to the city, Cummings expressed excitement over the Finance Committee’s approval and is hopeful the City Council will also OK the $100,000 transfer. The transfer would move the $100,000 from the economic development account to the Marlborough Economic Development Corporation’s funding line item.

“I am grateful the City Council’s Finance Committee recommended appropriating funding for this program,” said Cummings. “I believe it will be a wonderful tool we as a community can use to help small businesses.”

Along with the $100,000 the Marlborough Economic Development Corporation is seeking from the city, four local banks – Digital Federal Credit Union, St. Mary’s Credit Union, Avidia Bank and Marlborough Savings Bank –  have each pledged $50,000 for the program, said Cummings.If approved by the full City Council, prospective and existing business owners could apply for loans through the program, which will be reviewed by the Marlborough Economic Development Corporation. Cummings last week said businesses will be required to pay back their loans as if they were borrowing independently.

This article by Jeff Malachowski originally appeared here.