PROGRAM: The Linked Deposit Program, adopted by the City Council in 1996, was established to stimulate economic development opportunities for small businesses, emerging businesses and those owned by women and minorities. The program assists businesses by allowing them to receive loans from financial institutions at lower interest rates. By placing certificates of deposits with a financial institution at an interest rate 2 percent below market, the City enables financial institutions to reduce the loan rate to borrowing businesses by 2 percent.
PROGRAM GOAL: To help remove the barrier of access to affordable capital to small and emerging businesses.
TYPE OF ASSISTANCE: Reduction of small business loan interest rate
TYPICAL STRUCTURE: Varies based on terms established by financial institution
MAXIMUM AMOUNT: $150,000.00
REPAYMENT: Varies based on terms established by financial institution
INCENTIVES: 2% reduction in interest rate on loan from a financial institution
BENEFITS: Lowers the borrowers interest on a loan
ELIGIBILITY: All types of businesses are eligible, including high-tech, manufacturing, industrial, retail, service, real estate, financial services, and professional services. To qualify under the program, the business must have:
1. For-profit status,
2. A location in the City of Cincinnati,
3. 50 or fewer employees,
4. Net worth no greater than $250,000,and
5. Annual sales of less than $5 million.
Businesses with annual sales between $1 million and $5 million must receive a written justification from the bank that the project would not be done without assistance from this program.
CRITERIA: Based on borrower's eligibility.
ELIGIBLE/
INELIGIBLE USES: The Linked Deposit Loan Program cannot be used to refinance debt.
EVALUATION: Based on borrower's eligibility.
RATES/FEES: No City fees.
APPROVAL: Approval required by DCD and Treasury Division.
PROGRAM EXAMPLES: Mackie Quality Meats, Northside Grinding Company, LLC, Banacom Instant Signs.
