The city of New York announced on March 6 that it will be launching affordable business loans to tap female entrepreneurs and help them grow their business.
In partnership with Goldman Sachs, the new program called WE Credit will help 250 women entrepreneurs access lines of credit starting from $50,000. Interest for this type of loan is below market rates. This program is part of the private-public partnership of Goldman Sachs to 10,000 small businesses program, which will provide $5 million credit in total.
This investment also has $1 million loan loss reserve fund provided by the Squarespace and the New York City Economic Development Corporation.
Meanwhile, Goldman Sachs emphasizes its support to women and hopes that others will follow. They hope that this new program can become a model for lending institutions to recognize discrimination against women entrepreneurs.
“Women, even though they are starting a small business at a significant rate, fundamentally don’t get the same amount of capital that their male counterparts do,” said Managing Director Margaret Anadu.
NYC Mayor Bill de Blasio also share the same sentiment and said, “To truly become the fairest big city in America, we need to give everyone an opportunity to participate in our economy, regardless of your gender, race or ethnicity. That means breaking down the barriers and providing the resources people need to establish, grow and sustain their business.”
According to research, approximately 70 per cent of NYC-based women entrepreneurs cited capital as a primary challenge. Because they have no access to funding, many of these women end up relying on personal credit cards and payday lenders, with unbelievably high interest.
