Innovative Small Business Financing Initiative Travels to “Main Street” New York
Kingston, NY (January 19, 2010) - United States Senator Charles Schumer visited Ulster County Executive Mike Hein today to announce his plans to encourage leaders and financial institutions throughout New York State to replicate Ulster County’s “Credit for Success” program in their own communities.
Schumer announced the beginning of a program, based on the Ulster County model, that will use capital from banks all over the state to increase the amount of credit available to small businesses. Schumer said that there are 24 banks that have joined various regional consortiums, located throughout the State, with several banks committing to more than one region. There are at least four banks in each region and a total of $6.1 million has been pledged so far.
The “Credit for Success” model encourages banks within a region to pool funds to improve access to capital for small businesses. The voluntary program uses no public funds. The consortium model goal makes it possible for local banks to “share the risk” in order to help local “Main Street” businesses succeed – and retain and grow jobs in their communities during these difficult times.
Senator Schumer has long been an advocate of small businesses in New York and he has been particularly concerned with the problem of good, small businesses being denied access to the credit they need. He was attracted to the Ulster County model which makes a direct connection between local lending and small business entities and can be implemented quickly and easily in any community in the State.
“I’d like to thank County Executive Mike Hein for bringing forward this innovative idea and for his generosity in sharing it. Small business will be at the tip of the shovel that digs out of this down economy, but only if we can get them the resources we need, and prevent the credit crunch from strangling their efforts to expand,” said Schumer.
County Executive Hein said, “I applaud Senator Schumer for fighting for small businesses and for expanding the reach of this innovative program. This is really about saving jobs. When small businesses can access capital, hardworking people stay employed.”
The original Ulster County Banking Consortium, formed in November of 2009, at the urging of County Executive Hein. It brought together seven regional banks and primary lenders, including Catskill Hudson Savings Bank, Rondout Savings Bank, Sawyer Savings Bank, TD Bank, Ulster Savings Bank and Walden Savings Bank, along with the New York State Business Development Corporation (NYBDC), a private bank owned entity. NYBDC plays a dual role in the Consortium as lender and as fund administrator. The Consortium quickly grew to eight members and $1.35 million in capital when Provident Bank and Empire State Bank joined. The Consortium makes loans, from $25,000 to $150,000, to eligible businesses that have been denied loans under conventional lending guidelines.