Helping Small Businesses Grow, Expand and Create Jobs in SC

The SSBCI Loan Participation Program enables small businesses in South Carolina to obtain short to long-term financing to help businesses grow and expand, ultimately creating and retaining jobs in South Carolina. By partnering with financial institutions, this program provides small business loans at attractive terms while reducing the risk for the lender.

SSBCI Loan Participation Program Overview

Qualifying BorrowersProgram is designed to target businesses with 500 or fewer employees and whose loan request is $5 million or less. Qualifying not-for-profit entities are also eligible.
Maximum BDC Participation Amount$1,000,000 (exceptions may apply).
Maximum Participation PercentageGenerally, 25%.
Eligible Loan PurposesProceeds must be used for a business purpose in the state of South Carolina.
Ineligible Loan PurposesPassive real estate investment, speculative activities, gambling, pyramid sales, activities prohibited by Federal or State law.
Maximum Loan TermUp to 20 years for term loans. Also eligible are lines of credit.
Interest Rate/FeesDetermined by lender, subject to BDC concurrence.
Form of ParticipationAt the time of loan inception, lender and BDC to mutually agree whether collateral position will be equal (pari-passu) or BDC subordinated to lender in the event of default.
Loan ServicingLender is responsible for all loan servicing and liquidation (if required).
Documentation RequiredMaster Loan Participation Agreement, Application for Participation, Bank’s Underwriting Credit Memo and Borrower’s Financial Statement, BDC Commitment Letter, Participation Certificate, Borrower Certification, Bank Closing Documents.
Lender/Borrower CertificationLender and Borrower must certify no conviction of a sex crime against a minor, as defined (42 U.S.C.-16911). Other certifications required as listed in documents named above.

“Access to capital has empowered small businesses across our state to open, expand and to put more people to work. These critical funds have provided a powerful reason for banks to lend to stimulate job creation in South Carolina.”
– Harry Huntley, Executive Director, SCJEDA

Benefitting Both Small Businesses and Lenders

In addition to helping promote economic development and create jobs in South Carolina, the SSBCI Loan Participation Program benefits both small businesses and lenders.

Small Business Borrower

  • Provides small business loans at attractive terms
  • Provides a flexible and non-bureaucratic resource for funding
  • Provides fast disbursement of funds to the borrower
  • Allows borrowers to receive a quick response to a loan request

Lender

  • Provides lender reduced risk of loss
  • Allows the lender the ability to approve a loan that would otherwise be declined
  • Helps the lender retain client and ancillary banking services
  • Provides the lender CRA credit for each transaction

Use of Proceeds

Proceeds must be used for a business purpose in the state of South Carolina, which includes (but is not limited to) the following:

  • Working capital
  • Receivables
  • Equipment and inventory
  • Start-up costs
  • Term loan financing
  • Lines of credit
  • Trade cycle financing
  • Purchase or construction renovations of non-passive real estate

For Profit and Non-Profit Businesses that Qualify

Businesses that may qualify for this loan program are entities that carry on a business activity for profit or not-for-profit in South Carolina, including:

  • For-profit corporation
  • Limited liability company
  • Partnership
  • Joint venture
  • Sole proprietorship
  • State-designated charitable, religious or other non-profit or eleemosynary institution
  • Government-owned corporation
  • Consumer or marketing cooperatives

For more information about the SSBCI program, contact BDC at www.BDCofSC.org or call (803) 798-4064 or contact JEDA at www.scjeda.com or call (803) 737-0268.