At a press conference held at Anthony Ashley Hair Design, located at 1740 Allen Street in Allentown, Rising Tide officials commented on the challenges many small businesses are having gaining access to credit. Rising Tide Community Loan Fund President Steve Melnick said, “This challenge is significant and overcoming it may be the difference between surviving this recession and not.” Anthony Ashley is owned by successful Rising Tide borrower Jeannine "Nina" Tulio, pictured above, who also spoke at the event.
Chris Hudock, Director of the Rising Tide Community Loan Fund, explained that the Small Business Opportunity Fund will help meet the needs of more Lehigh and Northampton County business owners. According to Hudock, “Historically, about 20% of the people who contact us request more than the $35,000 amount. This new product will allow us to reach a broader range of owners and keep more jobs and commercial properties in our neighborhoods.”
Kevin Rogers, Vice President of PNC Bank, which invested $100,000 to capitalize the Small Business Opportunity Fund, expressed his bank’s enthusiasm for investing in a lending vehicle to make loans banks once made as a matter of routine, but which the current climate has made especially difficult. Other investors in the new loan product include Embassy Bank, First Niagara Bank, KNBT, Susquehanna Bank, Team Capital Bank, TD Bank, Wells Fargo Bank, Lehigh and Northampton counties (through their Community Development Block Grant, and the U.S. Treasury through the Community Development Financial Institutions Fund. Their combined contributions total more than $900,000 in funding.
Lehigh County Executive Don Cunningham also spoke at the press conference, representing Lehigh County’s $100,000 investment in the new loan fund. Cunningham expressed the county’s respect for the Rising Tide’s efforts to create opportunities for businesses to grow as we work toward economic recovery.
Tulio, who obtained a loan from the Rising Tide in April, 2006, and has since repaid in full, described the success her business has seen over the last several years. “Although the loan was only for $5,000,” Tulio says, “that start-up money was crucial. I had a credit score of over 700 and I still couldn’t find a bank that would even talk to me. This loan was the reason I could stay in business.” As the only entirely organic salon in the Lehigh Valley, Anthony Ashley Hair Design has since grown from a one-woman business in a 600-square-foot shop to a total of 4 stylists in a 1,600-square-foot location.
The Rising Tide has granted a total of 81 loans to women, minorities and low-to-moderate income businesses. Total investment? $1.58 million. Of these 81 loans, 35 are paid-in-full. Only 5 loans, totaling $48,000, have been written off as uncollectable. That's a charge off ratio of just 3.03%.
These loans have led to the creation of at least 131 jobs and helped to retain 98 more. The Small Business Opportunity Loan Fund is a separate Rising Tide loan product from the micro-loan product that provided these loans. A subsidiary of the Community Action Committee of the Lehigh Valley, Rising Tide helps build economic opportunity across the Lehigh Valley by providing affordably priced credit products to small businesses and prospective entrepreneurs.
For other posts about Rising Tide, see Did You Know CACLV Likes Small Businesses? and CACLV Helps Dogs Keep Up With Latest Fashions.