The state of California recently announced the approval of $1.1 billion in federal funds that will increase state loan guarantees made to eligible small businesses, furthering their ability to obtain even larger loans needed to grow their companies.

California Governor Gavin Newsom on Sept. 21 announced the greenlighting of the state’s application for $1.1 billion from the U.S. Treasury’s State Small Business Credit Initiative (SSBCI). Half of the award will be issued to the California Infrastructure and Economic Development Bank (IBank) under which Small Business Development Corporation of Orange County operates and administers the state’s Small Business Loan Guarantee Program. This flagship IBank program assists small businesses, particularly those in underrepresented areas, obtain access to capital. The SSBCI funding will allow increased guarantees of up to 80% or a maximum $5 million on a small business’s outstanding loan, helping businesses acquire even larger loans and assuring lenders of repayment.

The federal award arrives through the American Rescue Plan Act of 2021 and is intended to leverage an additional $18 billion of capital to California small businesses, states a release from the governor’s office. In addition to shoring up the state loan guarantee program, the federal funds will support IBank’s launch of the new Venture Capital program. For further information on the SSBCI award, impacted programs and lender participation information, click here.