FHLBank Chicago Expands Support for Small Businesses in Illinois and Wisconsin

Strategic Insights -

FHLBank Chicago, a regional bank in the Federal Home Loan Bank System, has announced expanded discounted lending and grants to support small businesses in low- and moderate-income communities in Illinois and Wisconsin. The bank's commitment to providing access to capital for small business owners is critical, as they face challenges with growing or enhancing their operations due to surging borrowing costs in a high-interest rate environment.

The expanded discounted lending program, known as the Community Small Business Advance, increases the zero-rate advance from $2 million to $10 million through year-end, allowing FHLBank Chicago member financial institutions to provide significantly below-market rate loans to eligible small businesses. Additionally, grants of up to $25,000 per small business will be awarded through the Community First Accelerate Grants for Small Business program, supporting a variety of purposes such as purchase or improvement of property, equipment, workforce development, and technology.

FHLBank Chicago's member financial institutions can provide loans to small businesses that meet certain criteria, including annual receipts or number of employees based on U.S. Small Business Administration (SBA) regulations. The bank's Community Small Business Advance program has already shown its effectiveness, with Fayco Enterprises, Inc., a Community Integrated Living Arrangement (CILA) provider in Greenville, Illinois, recently receiving a low-cost loan that enabled the construction of a 6-bedroom, service-enriched, group home for developmentally disabled individuals.

Grant recipients, such as Deerfield Coffeehouse in Dane County, Wisconsin, owned by Teresa Pelletier, have also benefited from the program, receiving a Community First Accelerate Grant for Small Business in 2022 to support improvements to her building. The grant was instrumental in helping Pelletier make her coffee shop more inviting to customers, enhancing the overall community experience.

Key Takeaways:

  • FHLBank Chicago's Community Small Business Advance now offers up to $10 million in zero-rate advances through year-end to support small businesses in low- and moderate-income communities.
  • Grants of up to $25,000 per small business will be awarded through the Community First Accelerate Grants for Small Business program to support a variety of purposes.
  • Eligible small businesses for the Community Small Business Advance program must meet SBA regulations for annual receipts or number of employees.
  • FHLBank Chicago's member financial institutions can provide significantly below-market rate loans to eligible small businesses using the Community Small Business Advance program.
  • The Community First Accelerate Grants for Small Business program has already provided support to businesses like Deerfield Coffeehouse in Dane County, Wisconsin, owned by Teresa Pelletier.

Statistics:

  • The zero-rate advance for the Community Small Business Advance program has been increased from $2 million to $10 million through year-end.
  • Grants of up to $25,000 per small business will be awarded through the Community First Accelerate Grants for Small Business program.
  • The program has already provided support to businesses like Fayco Enterprises, Inc., a Community Integrated Living Arrangement (CILA) provider in Greenville, Illinois.
  • FHLBank Chicago's Community Small Business Advance program has enabled the construction of a 6-bedroom, service-enriched, group home for developmentally disabled individuals.

Sources:

  • "FHLBank Chicago Expands Support for Small Businesses in Illinois and Wisconsin" (Business Wire, August 2023)
  • https://www.businesswire.com/news/home/20230823779394/en/
  • About the Federal Home Loan Bank of Chicago (FHLBank Chicago website, accessed August 2023)
  • View source version on businesswire.com: https://www.businesswire.com/news/home/20230823779394/en/