The Small Business Administration (SBA) has announced the award of $5.2 million in grants to organizations that support economically underserved businesses.
Awarded under the Program for Investment in Micro-Entrepreneurs, the grants are targeted at organizations with a strong track record in helping low-income entrepreneurs secure financing to launch and expand their small businesses.
The awards, which are slightly down on the $5.5 million handed out last year, range between $75,000 and $250,000.
Some 27 organizations have been awarded PRIME grants from among 101 US-based applicants in 2021’s cohort.
They include 15 organizations that provide services in ‘Opportunity Zones’ – around 9,000 low-income areas in the US with tax breaks that incentivize investors to support economic development – and 12 doing so in ‘HUBZones’, hitherto neglected business zones now prioritized for federal funding.
PRIME grants are awarded to organizations that deliver micro-enterprise services to disadvantaged entrepreneurs, as well as Indian tribes if no such organization or program exists within their jurisdiction.
"Build back better"
“The Biden-Harris Administration and Congress have worked together tirelessly to ensure our nation's small businesses have the resources they need to survive this pandemic and build back better,” said SBA Administrator Isabella Casillas Guzman in a press release issued on Friday (September 3).
“This year, SBA focused our PRIME grant selection process on our nonprofit partners who can best bring federal resources to life, especially in the regions and communities where they are needed most. I look forward to partnering with these organizations as they help us connect America’s entrepreneurs with the capital they need to start and grow their enterprises.”
At least 75% of grant funding is provided specifically for the provision of training and technical assistance to disadvantaged micro-entrepreneurs (often defined as employing fewer than 10 staff).
Grants are also given to support training and ‘capacity-building' at micro-enterprise development organizations and programs, to support their research and development in the field, and ‘discretionary grants’ for related activities.
Grants typically require at least 50% in matching funds or in-kind contributions.
Empowering female entrepreneurs
In related news, SBA Administrator Isabella Casillas Guzman recently set out the SBA’s achievements in empowering female business owners, including seven new programs and the SBA’s recent expansion of its network of Women’s Business Centers.
During a ‘fireside chat’ held to mark Women’s Equality Day on August 26, Guzman also highlighted the $28.6 billion Restaurant Revitalization Fund, which prioritizes women, veterans, and socially and economically disadvantaged business owners, and the $16.2 billion Shuttered Venue Operators Grant (SVOG) program targeting more than 10,000 performing arts venues, museums, and similar businesses reeling from the fallout of Covid-19.
The emergence of the Delta variant has only further increased pressure on the SBA to provide financial support to America’s small businesses.
In February, a survey conducted by the Federal Reserve Bank revealed that three out of 10 small businesses in the US feared they probably wouldn’t survive 2021 without additional federal support – equating to nine million firms.
The proportion rose to eight in 10 for minority-owned businesses.