SSBCI: State Small Business Credit Initiative

On March 11, 2021, President Biden signed The American Rescue Plan Act (ARPA), which reauthorized and funded the State Small Business Credit Initiative (SSBCI). The new version of the SSBCI program provides a combined $10 billion to states, the District of Columbia, territories, and Tribal governments to empower small businesses to access capital needed to invest in job-creating opportunities as the country emerges from the pandemic. The funds will also support recipient jurisdictions in promoting American entrepreneurship and democratizing access to startup capital across the country, including in underserved communities. 

Read more about the SSBCI program on the US Dept. of Treasury website.

U.S. Treasury Objectives:

  1. Promote Equity. The program has a capital allocation to business enterprises owned and controlled by socially and economically disadvantaged individuals (SEDI-owned businesses), along with incentive funds for jurisdictions that demonstrate robust support for SEDI-owned businesses.
  2. Catalyze Private Investment. SSBCI is designed to catalyze $10 of small business lending and investment for every $1 of SSBCI capital program funding, magnifying the effects of the federal funds allocated through the program.
  3. Fuel Economic Growth and Good Jobs. SSBCI will build on the Administration’s work to support small businesses while combating longstanding structural inequities in access to credit and unequal opportunities for growth revealed and exacerbated by the pandemic.

Jurisdictions may select from five different programs to deploy capital per SSBCI regulations:

  1. Capital Access Programs provide portfolio insurance in the form of a loan loss reserve fund, into which the lender and borrower contribute.
  2. Collateral Support Programs provide cash collateral to improve small businesses’ ability to borrow funds to grow a business.
  3. Loan Guarantee Programs support private loans that may have otherwise been inaccessible or prohibitively expensive by agreeing to reduce the lender’s exposure on a loan.
  4. Loan Participation Programs provide credit support through the purchase of a portion of a loan made by a lender or through a direct loan alongside a private lender.
  5. Equity/Venture Capital Programs

    provide capital in the form of equity investments to underserved startups and investors.

Program Updates:

  • New Mexico is allocated to receive ~$74,000,000 over the course of the 10-year program. SSBCI funding is distributed in three different tranches, with each tranche representing a portion of the total allocated to the state.
  • During the current assessment phase, New Mexico intends to allocate ~$64 million to a VC (Venture Capital)/Equity Funds program and $9 million to a Collateral Support program.
  • EDD is the implementing entity on the program for the state.
  • In August 2023, EDD entered into a Memorandum of Agreement (MOU) with the New Mexico Finance Authority (NMFA) to partner on the administration of the SSBCI in New Mexico. NMFA is currently supporting EDD on the deployment of its first tranche of SSBCI funding to equity/venture capital funds. New Mexico businesses that have an interest in raising investment capital or venture private equity/venture capital funds seeking potential investment should submit an interest form on the NMFA website at Venture Capital Program | New Mexico Finance Authority (

New Mexico SSBCI Technical Assistance (TA) Program

The New Mexico SSBCI TA program is designed to support registered business owners in various critical areas. The program is set to launch soon, focusing on providing essential support to very small and socially economically disadvantaged businesses. This program will offer business workshops to all and 1:1 assistance to eligible businesses with services such as financial advisory, legal advisory, and accounting assistance. A portion of the program will be specifically tailored for venture capital interested funds and emerging fund managers, and business interested in accessing venture capital. The New Mexico SSBCI TA program aims to provide the necessary tools and guidance to help these businesses thrive. By offering targeted assistance in key areas, the TA program seeks to empower businesses in navigating accessing capital to support growth, job creation, and sustainability of New Mexico’s business community.

The following contractors have been selected via RFP to administer the NM SSBCI TA program for the first year.

  • WESST -Financial Advisory Services
  • HatchForm LLC – Legal Advisory Services
  • UNM Anderson – Venture Capital and Emerging Fund Manager Assistance in the areas of Financial, Legal, and Accounting

A Very Small Business (VSB) is defined as a business with fewer than 10 employees and includes independent contractors and sole proprietors.

A SEDI-owned business is: a business enterprise that self-certifies that it is owned and controlled by individuals who have had their access to credit on reasonable terms diminished compared to others in comparable economic circumstances, due to (1) membership of a group that has been subjected to racial or ethnic prejudice or cultural bias within American society, (2) gender, (3) veteran status, (4) limited English proficiency, (5) disability, (6) long-term residence in an environment isolated from the mainstream of American society, (7) membership of a Federally or state-recognized Indian Tribe, (8) long-term residence in a rural community, (9) residence in a U.S. territory, (10) residence in a community undergoing economic transitions (including communities impacted by the shift towards a net-zero economy or deindustrialization), or (11) membership of an underserved community.

A full definition of VSB and SEDI can be found here on page 3.

Collateral Support Program (New Mexico Collateral Assistance Program - CAP)

EDD can pledge cash to cover a collateral shortfall of a loan in order to enable financing that otherwise might not be available to a small business.

Learn more about CAP.

The SSBCI program provides support and capital allocation specifically to Business Enterprises Owned and Controlled by Socially and Economically Disadvantaged Individuals (SEDI) and Very Small Businesses (VSBs):

  • SEDI: Socially and Economically Disadvantaged Individuals. Defined by reference to section 8 of the Small Business Act (15 U.S.C. 637), the definition includes:
    1. Socially disadvantaged individuals are those who have been subjected to racial or ethnic prejudice or cultural bias because of their identity as a member of a group without regard to their individual qualities.
    2. Economically disadvantaged individuals are those socially disadvantaged individuals whose ability to compete in the free enterprise system has been impaired due to diminished capital and credit opportunities as compared to others in the same business area who are not socially disadvantaged.
  • VSB: Very Small Business is defined as a business with fewer than 10 employees; and may include independent contractors and sole proprietors.