St. Paul, MN (KROC-AM News ) - The state agency has announced the rollout of a temporary small business loan program that was authorized by the Minnesota Legislature last week.

The Minnesota Department of Employment and Economic Development says the Minnesota Small Business Loan Guarantee Program provides another option for financing to assist small businesses as they weather the COVID 19 crisis. The agency estimates the $10 million state appropriation for the program will guarantee $20 million to $25 million in loans for small businesses in Minnesota.

“We created this loan guarantee program because we know many small businesses across Minnesota need help and that existing emergency loan programs may not meet the needs of every business,” said DEED Commissioner Steve Grove. “The Minnesota Small Business Loan Guarantee Program is part of a slate of emergency small business assistance options DEED is implementing with bipartisan support from the state legislature.”

DEED will not serve as the lender but will work with financial institutions and other lenders throughout Minnesota to use the state funds to support small business loans of up to $250,000 with the state providing an 80 percent guarantee. The funding obtained through the loan program must be used in Minnesota and can only be used to leverage funds for businesses with fewer than 250 employees.

Enter your number to get our free mobile app

MORE TO EXPLORE: See the the COVID-19 stimulus bill broken down by the numbers