Small businesses are widely acknowledged to be the engine of economic growth. The California Reinvestment Coalition (CRC) sees the support and growth of small businesses in low-income communities and communities of color as a critical focus of its work. These businesses, often minority- and women-owned, encounter much greater difficulties receiving conventional loans from banks than larger businesses or those located in wealthy communities. In this work, CRC has focused on three particular issues.
- Support for nonprofit organizations that provide technical assistance to small businesses. Businesses often do not have the resources to get critical assistance to bolster their marketing, human resources and other business components. As a result of dialog with CRC members, Wells Fargo and Comerica Banks have put in place grant initiatives that build the capacity of these nonprofit organizations statewide.
- Investments to build the capacity of nonprofit community development corporations and financial institutions that offer more accessible credit to these critical businesses. This has been critical because banks have essentially stopped lending to smaller businesses and loans of $250,000 or less.
- Making bank small business loan underwriting more flexible and gaining access to business loan denials where community lenders may be able to make the loan.