Texas Border Business
HARLINGEN, Texas – The Harlingen Economic Development Corporation (HEDC) has partnered with PeopleFund to launch a revolving loan fund that will provide $2 million in loan capital for eligible small businesses located within the Harlingen city limits.
As part of the program, the HEDC will grant $500,000 to PeopleFund. PeopleFund will match that amount with $1.5 million, bringing the total amount of capital in the revolving loan to $2 million.
“This is a great opportunity, and we are honored to partner with PeopleFund,” HEDC Board President, Eric Ziehe, said.
“Small business owners can use these funds to expand their business, create more jobs if needed, and create a positive economic impact in our community.”
PeopleFund is a nonprofit Community Development Financial Institution (CDFI) that creates economic opportunities for underserved communities by providing capital, resources, and tools necessary to build and grow a successful business. PeopleFund will originate and service the loans to eligible Harlingen small businesses.
“PeopleFund is excited about creating this revolving loan fund with HEDC. Harlingen’s location and diverse economy have a strategic importance.” Said Gustavo Lasala, CEO of PeopleFund.
“By helping small businesses in the area with affordable capital and free business coaching this fund will support the growth of a healthy vibrant economy that will benefit both Texas and the country.”
All applications will be submitted and reviewed by PeopleFund, which has locations throughout the state, including in the Rio Grande Valley. Local loan officers will be available to guide loan applicants and recipients through the process.
“Loan recipients can use these funds to grow their business and create jobs,” said Beverly Loftus, HEDC Interim CEO.
“As the loans are deployed, we expect to see approximately 150 jobs retained/created over the course of 5 years. Investing in a revolving loan fund has the greatest impact in the long term because as loans are repaid, the capital would be re-deployed in the area.”
The revolving loan fund program will begin on April 1, 2023, and end on March 31, 2028. PeopleFund will continue to revolve and originate the loans and provide free technical assistance to eligible loan recipients beyond the end date.
Eligibility for the program includes the following:
- Businesses with an existing loan with PeopleFund and an established physical address in the City of Harlingen
- Businesses that do not have a loan with PeopleFund but have an established physical address in the City of Harlingen.
- At least 60% of the loan proceeds shall be allocated to minority-owned businesses and at least 60% to low and moderate-income business owners.
PeopleFund loan interest rates typically range from 7% to 15% with 60 months average term. The maximum loan amount disbursed under this fund will be $350,000. At least 25% of the fund will be allocated to $50,000 and under loans.
“Small businesses draw people from all over to Harlingen; these small businesses are the foundation of communities,” Mayor Norma Sepulveda said. “We want to support their growth, which will, in turn, produce economic opportunities for our community.
