Utah Small Business Credit Initiative

The Utah Governor’s Office of Economic Opportunity administers a statewide small business capital access program under the U.S. Treasury’s State Small Business Credit Initiative, established by the 2021 American Rescue Plan Act. In Utah, the loan program is called the Utah Small Business Credit Initiative (USBCI).

According to the U.S. Treasury, the program is a transformational investment in American small businesses. It provides capital and technical assistance to help small businesses and entrepreneurs grow, succeed, and remain stable, benefiting communities nationwide.

Strengthening Utah Small Businesses With USBCI

USBCI aims to help small businesses grow by providing much-needed access to capital.

In November 2022, the Treasury signed an agreement with GOEO, representing the state of Utah, to provide $69 million for the state’s SSBCI program. The funds are available in three tranches as follows:

Tranche One: $23 million (Nov. 2022 to Nov. 2025)
Tranche Two: $23 million (Nov. 2025 to Nov. 2028)
Tranche Three: $23 million (Nov. 2028 to Dec. 2030)

GOEO received tranche one funds in 2022 and can access tranche two funds as soon as the state has committed 80% of tranche one funds to Utah small businesses. The same rule applies to accessing tranche three funds.

Following the Treasury’s guidelines, Utah anticipates the program will have a 10-to-1 economic impact, unlocking around $690 million in private investments throughout the state.

The USBCI program will expand access to capital for Utah business owners in underserved communities.
The program aims to allocate 29% of funds to women-owned businesses and other culturally, economically, and geographically diverse entrepreneurs.
The program is most helpful to Utah small businesses that cannot access traditional bank loans due to limited equity, low credit scores, or time in operation.

USBCI’s Loan Programs

Capital Access Program

The USBCI Capital Access Program (CAP) provides lender loss protection to help lenders fund projects they typically may not fund or where the lender’s risk may be higher due to a non-collateralized loan.

CAP best suits employers with fewer than 500 employees and capital needs between $25,000 and $5,000,000.

CAP Supports High-Risk Projects with Loan Loss Reserve

This flexible loan loss reserve program helps lenders fund projects considered too risky for conventional lending. Through CAP, the state provides funds to a dedicated loan loss reserve account that lenders can utilize if a loan defaults.

Approved loan loss reserve accounts are eligible for this program in an amount equal to the premiums paid by the borrower and the financial institution lender to the reserve fund. We calculate this amount on a loan-by-loan basis.

The reserve account balance increases with each enrolled loan. Once the lender has accumulated sufficient reserves, it can receive up to 100% reimbursement for any defaulted enrolled loan.

Program funding is available from 2023 to 2030.

Benefits

Expands access to credit for small business borrowers
Enhances Community Reinvestment Act (CRA) efforts
Maximizes private investment per dollar of public capital
Due to current interest rates, CAP is best suited for loans from $25,000 to $250,000 (but can accommodate borrowing up to $5,000,000)

Eligibility

The following may be eligible to participate in CAP:

Utah banks
Utah credit unions
Community Development Financial Institutions (CDFIs)

How to Apply

Eligible program partners include insured depository institutions, federally insured credit unions, and CDFIs.

USBCI staff will review applications and notify participants upon approval. If approved, financial institutions must sign a CAP Lender Master Agreement and adhere to the program’s terms and conditions before GOEO can process individual loan transactions.

Partner with USBCI’s CAP Program

Loan Participation Program

The USBCI Loan Participation Program (LPP) enables small business owners to obtain a reasonable rate and term on medium- to long-term financing through a collateralized term loan.

LPP assists Utah employers with fewer than 750 employees and capital needs between $10,000 and $1,000,000.

LPP Expands Small Business Access to Capital

LPP purchases up to 50% of a small business loan to expand access to credit and lower blended interest rates for small business borrowers.

The program runs from 2023 to 2030 and utilizes a network of Economic Development Organizations (EDOs)* to manage the loan program on behalf of the state. These organizations partner with banks and credit unions (primary lenders) on a loan-by-loan basis to expand small businesses’ access to capital. The program participates in a lender loan at up to 50% participation rate.

How it Works

USBCI funding deployed by EDOs receives a low interest rate and fee set by the state
Private funding deployed by the primary lender receives a market rate set by the lender
The borrower receives a blended interest rate between the going market rate and the state’s low interest rate

When the program concludes in 2030, participating EDOs will receive 50% of the funds they deploy. The unencumbered 50% will help EDOs invest in Utah’s gap financing ecosystem.

After 2030, GOEO will use the other 50% to fund a new small business capital access program.

Benefits

Enables lenders to expand access to credit for small businesses
Provides small businesses with interest rates and fees below market rates by combining low-cost public capital with private investment
The EDO and primary lender partnership enables the program to help distribute capital to underserved communities and regions

Eligibility

The following may be eligible to participate in LPP:

Utah banks
Utah credit unions
Community Development Financial Institution (CDFI)
Revolving loan funds
Nonprofit lenders

How to Apply

Economic Development Organizations (EDOs) include CDFIs and qualifying economic development organizations with a revolving loan fund.

USBCI staff will review applications and notify participants upon approval. If approved, financial institutions must sign an LPP Lender Master Agreement and adhere to the program’s terms and conditions before GOEO can process individual loan transactions.

Partner with USBCI

Additional Resources & Questions

Email us at usbci@utah.gov to learn more about USBCI’s LPP loan program, access additional resources, and explore onboarding and training materials. We also welcome your feedback and are happy to answer any questions.

View the list of Utah EDOs partnering with USBCI under Enrolled lenders.

How Utah Small Businesses Access USBCI Capital

Utah's small businesses receive capital from lenders, and loan repayments help expand access to funding for even more companies statewide.

USBCI contracts with Utah lenders, including:

Banks
Community Development Financial Institutions (CDFIs)
Credit unions
Economic Development Organizations (EDOS) with revolving loan funds
Nonprofit lenders

Small businesses go to USBCI-contracted lenders to apply for and secure loans in partnership with the state.

List of enrolled lenders

Program Requirements

Businesses must apply through an enrolled lender to participate in the USBCI program. Because this program works with lenders’ private capital, it reduces but does not eliminate traditional lending requirements.

Program requirements include:

Business plan/intended use
Financial projections
Tax returns
Collateral
Business and personal credit scores
USBCI certifications (listed below)

USBCI-enrolled lenders will work with borrowers individually to evaluate their eligibility and underwrite loans in partnership with the USBCI program.

USBCI News

Sep / 2024

Bank of Utah Joins USBCI

Sep / 2024

Path to Prosperity — Bringing Community and Resources Together

Aug / 2024

Banking and Regulatory Leaders Discuss Small Business Financing in Utah

View all USBCI news

USBCI Enrolled Lenders

USBCI collaborates with financial institutions and community partners to provide small businesses with access to loans. A list of USBCI-enrolled lenders is below. Contact an enrolled lender and mention you're interested in applying for a USBCI loan to access funding for your small business.

If you have questions about becoming an enrolled lender, please email us at usbci@utah.gov.

Capital Access Program (CAP) Lenders

Lender/EDO	Service Area	Contact	Email
Desert Rivers Credit Union	Southeastern Utah	Lonnie Campbell	lonnie@mydrcu.com
MoFi	Statewide	Mary Milodragovich	marym@mofi.org
Suazo Business Center	Statewide	Andrea Benitez	andrea@suazocenter.org
Utah Micro Loan Fund	Statewide	Amy Phelps	aphelps@umlf.org

Loan Participation Program (LPP) Lenders

Lender/EDO	Service Area	Contact	Email
Altabank	Statewide	Ryan Jones	ryan.jones@altabank.com
Bank of Utah	Statewide	Shaun Sampson	ssampson@bankofutah.com
Brighton Bank	Greater Salt Lake	Shane Giddings	sgiddings@brightonbank.com
Cache Valley Bank	Statewide	Richard Skidmore	rskidmore@cachevalleybank.com
Desert Rivers Credit Union	Southeastern Utah	Lonnie Campbell	lonnie@mydrcu.com
First Community Bank	Davis and Salt Lake Counties	Kent Vance	kvance@fcbutah.com
MoFi	Statewide	Mary Milodragovich	marym@mofi.org
Mountain West Small Business Finance	Wasatch Front	Danielle Lower	dlower@mwsbf.com
State Bank of Southern Utah	Southern Utah	Eric Swayer	esawyer@sbsu.com
Suazo Business Center	Statewide	Andrea Benitez	andrea@suazocenter.org
UFirst Credit Union	Statewide	Steven Mathews	smathews@ufirstcu.com
Utah First Federal Credit Union	Statewide	Jeff Stringham	jstringham@utahfirst.com
Utah Micro Loan Fund	Statewide	Doug Keefe	dkeefe@umlf.org

U.S. Treasury Reports

USBCI is required to provide the U.S. Treasury with annual and quarterly reports. Below is our latest quarterly report.

To view older reports, visit the GOEO USBCI stack on issuu.com.

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