Linked Deposit Programs Provide Small Business Low Interest Loans for Job Growth or Retention

Every small business is faced with a decision at one time or another to either invest more capital for growth, or risk falling behind. Considering tougher competition and evermore demanding consumers it is important for small businesses to remain competitive in the current market place.

To help Ohio’s small businesses, and in recognition of their contributions to the economic growth of the state, Ohio Treasurer Richard Cordray is ramping up a new initiative to help those who need help from the bank to remain competitive and survive in the marketplace.

Cordray’s Small Business Linked Deposits Program is making more than $500 million available in linked deposit loans. Essentially, a linked deposit lowers the interest rate on bank loans by three percent for small businesses that are creating jobs or preventing layoffs for Ohioans.

For entrepreneurs who are creating or expanding your business, a three percent reduction on a loan could provide the necessary infusion of cash flow that could make job growth or job creation possible and in turn enhance Ohio ‘s economy.

A number of small businesses have come through the program already and represent a varied background of industry, such as, the service industry, manufacturers, retailers and distributors, financial industry and agricultural.

Here are the qualifications to receive a Small Business Linked Deposit and lower a loan’s interest rate:

  • your business must employ less than 150 people, and the majority of them must be Ohio residents;
  • your business must be organized for profit and have offices in Ohio ;
  • the operating facilities must exclusively be in Ohio ;
  • one full-time equivalent job must be effected for ever $25,000 requested;
  • a maximum of $250,000 may be requested.

Additionally, in order to receive the interest rate deduction, the lending bank must be qualified as a state depository. For the full list of eligible banks that qualify as state depositories, go to ohiotreasurer.gov.

The rate reduction on a loan is passed along to the small business, for a two-year time period. But, if the loan arranged through the lender is for more than two years, the loan will return to the agreed-upon rate after the linked deposit expires.

Funding decisions come on a first-come, first-served basis, and there is no application fee. For more information on Ohio Treasurer Richard Cordray’s Small Business Linked Deposits Program, or to download application forms, visit the Web site at www.ohiotreasurer.gov and click on “linked deposits.”

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