State Small Business Credit Initiative (SSBCI 2.0) Program Overview
History of the Original SSBCI
The State Small Business Credit Initiative was created through federal legislation in 2010 in order to improve access to capital by small businesses following the Great Recession.
The initial SSBCI program (SSBCI 1.0) was funded with $1.5 billion to strengthen state programs that support financing of small businesses. California received $168 million of the $1.5 billion, which was shared between two state agencies focused on small business support – the California Infrastructure and Economic Development Bank's (IBank) Small Business Finance Center and the California Pollution Control Financing Authority's (CPCFA) California Capital Access Loan Program, housed inside the State Treasurer’s Office.
For a review of the SSBCI 1.0 program results, as presented by the U.S. Treasury: https://home.treasury.gov/system/files/256/SSBCI-Summary-of-States-Annual-Report-2016_508-Compliant.pdf
For general information about SSBCI, visit the U.S. Treasury website.
Introduction to SSBCI 2.0
The American Rescue Plan Act of 2021 included $10 billion for the reauthorization of the State Small Business Credit Initiative, known as SSBCI 2.0. States, territories, the District of Columbia, and tribal governments must apply to receive their portion of the funds. $1.181 billion is allocated for California. The U.S. Treasury published program guidelines on November 10, 2021, made updates on October 7, 2022, and published updated guidelines on December 15, 2022. The types of programs allowed in a SSBCI 2.0 capital program application are: capital access program (also known as loan loss reserve), collateral support program, loan participation program, state-sponsored venture capital program, and loan guarantee program. Technical assistance application for small businesses is also part of SSBCI 2.0 and requires a separate application by each state, territory, the District of Columbia and tribal government.
California submitted its capital program application on February 4, 2022. California’s application is a joint application between CPCFA (California Pollution Control Financing Authority), housed within the State Treasurer’s Office, and IBank (California Infrastructure and Economic Development Bank), housed within GO-Biz (Governor’s Office of Business and Economic Development). IBank is the primary applicant and CPCFA is the co-applicant. CPCFA applied to implement a capital access program (also known as a loan loss reserve program) and a collateral support program for SSBCI 2.0. IBank applied to implement a state-sponsored venture capital program and a loan guarantee program for SSBCI 2.0.
How Does SSBCI 2.0 Bring Funds to California’s Small Businesses?
The CalCAP for Small Business Program (a loan loss reserve program) and the CalCAP Collateral Support Program (a cash pledge program) provide financial support to participating financial institutions when they make loans to small businesses. This incentivizes financial institutions to make loans to small businesses which often lack access to capital to grow or improve their operations. These existing programs will be deepened and expanded by SSBCI 2.0.
Please visit IBank for information on IBank’s Small Business Loan Guarantee Program and Venture Capital Programs.
How Do Financial Institutions Participate in SSBCI 2.0?
- Email CPCFA to learn about the one-page certification form to participate in the CalCAP for Small Business Program and/or CalCAP Collateral Support Program.
- Email IBank to learn about the one-page certification form to participate in the Small Business Loan Guarantee Program.