A bill that would help the smallest of small businesses tap into much-needed loans and funding has cleared the State Senate and Assembly. Today, the bill’s co-sponsor, State Senator Daniel Squadron, whose district includes the Lower East Side and parts of Greenpoint, Williamsburg and the East Village, gathered with other boosters of the Small Business Support bill to call on Governor Cuomo to sign it into law. The measure calls on the state to prioritize micro-businesses (i.e. those with less than five employees) when awarding Small Business Revolving Loan Fund loans, and would waive application fees for approved “micro-loans” of under $5,000.
New York State’s Small Business Revolving Loan Fund, created in 2010, was designed to allow small businesses easier access to capital. The fund receives $25 million in state funding, and has now been endowed with a $25 million private match. The Small Business Support Bill, Assemblyman Ron Kim argued at today’s event in Chinatown, will significantly help micro-businesses access this capital by defining the actual amount of a micro-loan, waiving the application fee for said micro-loan, and defining what actually constitutes a micro-business. These tiny businesses are particularly vulnerable to economic deviations, Kim continued, and simultaneously face restricted access to capital.
“The larger the business, the easier it is to gain capital. This is counterintuitive,” he said. Immigrants who work hard but have no credit history and no credit scores, on the other hand, often find themselves unable to get the capital they need to grow their business.
“My own parents ran a grocery store when I was growing up, and I will never forget the struggles and experiences they went through,” Kim continued. “My parents couldn’t go to a regular bank to apply for a loan.”
This new bill is meant to assist those mom and pop stores struggling to gain a footing. “This bill ensures critical state support for the small businesses that are a path toward opportunity for owners, and the lifeblood of our communities,” Senator Squadron said.
Today’s meeting took place at the Chinatown offices of Asian Americans for Equality, a non-profit that is particularly active in that neighborhood and Lower Manhattan. Among other things, the group provides loans and support to small businesses in the area. As such, Christopher Kui, the group’s executive director, praised the effect the bill would have on the small vendors and family-run businesses of the area. “Prioritizing and expanding access to seed funding will give AAFE and other community development organizations the ability to help entrepreneurs leverage their capital, encourage them to build start-ups, and create new jobs in their neighborhoods,” he said.
At the meeting, two small Chinatown business owners, Yim Chin Mui and Bill Zhen, explained the struggles they’ve faced with their livelihoods. Mui, who owns a small vegetable stand on Canal Street, suffered economic hardship both after 9/11 and Hurricane Sandy, two catastrophes that put Chinatown on lockdown and damaged her stand. She explained that she received assistance from the AAFE-affiliated Renaissance Economic Development Corporation, another micro-loan agency that will benefit from the bill, Kim explained.
Zhen, who owns a computer shop in Chinatown, explained that he was currently in the process of getting a micro-loan. “This will help me expand and grow my business,” he said. “It’s very hard for small businesses to get loans from banks.”