Louisiana Economic Development (LED), in partnership with The Louisiana Loan Portfolio Guaranty Program (LPGP), has launched its Loan Guaranty Program providing loans to Louisiana's small businesses suffering from COVID-19. The Louisiana Bankers Association members will offer the loans, which will be administered by the Louisiana Public Facilities Authority.
The LPGP will create a loan guaranty fund of up to $50 million and LED will guarantee 20 percent of the pool allocated to each participating bank.
Who's eligible?
All small businesses with less than 100 employees are eligible to receive up to $100,000 per applicant and any affiliates.
Who's not eligible?
Businesses solely engaged in gaming, non-profit work, real estate development, pawn shops, pay-day loans, lending and investment concerns, or "speculative activities" are not eligible for these loans.
While there do not appear to be any limitations on use of the funds, the LED has "suggested" funds be used to maintain operations and employee pay for an eight-week period at payroll levels at the time of the loan application. Additionally, the need for the loan and use of proceeds must be directly related to the economic injury caused by the COVID-19 pandemic.
Loan terms include:
- A repayment period of at least one year, which could be longer depending on business functionality during the length of the emergency period, and a maximum repayment period of five years.
- Fixed rate up to 3.5 percent (lower rates subject to lending institution).
- No interest or payments for six months.
Please click on these important links to access the Loan Application Worksheets (Worksheet 1; Worksheet 2) and a list of Participating Banks. Each bank will require the worksheets to be completed by all applicants in addition to their respective loan documents.
