Natalie Burley
Financial Programs Manager
Minority Business Development Division
(614) 644-7249
The Ohio Development Services Agency's Collateral Enhancement Program (CEP) was created to facilitate increased lending by banks to small businesses, and minority-owned businesses, at need access to capital for growth or expansion. The CEP is designed to enable financing that might otherwise be unavailable due to a collateral shortfall. The program supplies pledged cash collateral deposit accounts (or allocations for credit unions and certified development financial institutions) to lending institutions to enhance collateral coverage of individual small business loans. The program is designed to target certain situations, in which there is insufficient collateral shortfall value to make the loan.
Up to 30 percent of the loan amount for real estate, equipment, and working capital loans up to the maximum cash collateral deposit limits, unless the business is a food service business or franchise, in which case the limit is up to 15% of the loan amount.
Yes, the deposit percentage is up to 50 percent of the loan amount if the loan is to a minority-owned business certified with the State of Ohio Equal Opportunity Division or any reciprocal certification recognized by the State of Ohio Equal Opportunity Division.
Loans may be made with such interest rate, fees, and other terms and conditions as Lender and Borrower agree
Interest rates, maturity, and other loan terms are negotiated between the Borrower and the Lender
Lenders have responsibility for loan underwriting
1. The Collateral Enhancement Program was funded by the State Small Business Credit Initiative, a program of the U.S. Department of the Treasury and the Small Business Jobs Act of 2010.
2. "Principal" is defined as "If a sole proprietorship, the proprietor; if a partnership, each managing partner and each partner who is a natural person and holds a 20 percent or more ownership interest in the partnership; and if a corporation, limited liability company, association or development company, each director, each of the five most highly compensated executives or officers of the entity, and each natural person who is a direct or indirect holder of 20 percent or more of the ownership stock or stock equivalent of the entity."