GROW Receives $400,000 Federal Grant to Fund Small Business Development
Grand Rapids, MI — GROW received a $400,000 federal grant to increase its lending power in economically disadvantaged communities and fund small business development.
The grant is a Community Development Financial Institution (CDFI) Financial-Award. In 2016, GROW received CDFI designation from the U.S. Department of Treasury's CDFI Fund. This is the organization's second CDFI Financial Award.
GROW CEO Bonnie Nawara says the $400,000 will help the organization broaden its lending base to vulnerable areas. Currently, it provides microloan lending and technical assistance to drive small business development in Kent, Ottawa, Muskegon, Newaygo, Allegan, Barry, Ionia, Montcalm, and Kalamazoo counties
"This money helps us to stabilize our lending portfolio and drive our focus to deploy funds into communities of color," Nawara said.
CDFIs are certified by the U.S. Department of Treasury to inject new sources of federal capital into low-income communities and individuals who lack financing. Qualifying organizations are driven by a mission to offer affordable financial products and services that meet the unique needs of economically underserved communities. The CDFI Program uses monetary awards and training opportunities to invest in and build the capacity of CDFIs, empowering them to grow, achieve organizational sustainability, and drive community revitalization across the U.S.
According to the CDFI Fund Award Book, 375 organizations received a total of $187.3 million in awards. GROW was the only CDFI awarded in West Michigan.
GROW's Director of Lending Kelli Smith emphasizes that the grant award underscores a new chapter in the organization.
"Nearly half of the counties GROW serves have poverty levels higher than regional and statewide rates," Smith said. "The importance of small businesses and job growth cannot be understated when considering the economic distress of many of these communities. There is more demand for nontraditional capital in the West Michigan region than there are available funds."
In 2019, GROW issued $337,620 in loans to small businesses, 37% of which went to borrowers of color. 74% of borrowers reported being of low-to-moderate income. In response to the pandemic, GROW deployed has so far issued 41 loans totaling $382,000.
"The impact of this funding will be substantial for our service area," Smith continued, "It will aid in the equitable support of small businesses, job creation, and intentional investments into our local economy."
For information on lending opportunities from GROW, click here.