Drexel’s Nowak Metro Finance Lab & Kauffman Foundation
Executive Summary
Background
The State Small Business Credit Initiative (SSBCI 2.0) is a federal program authorized by the 2021 American Rescue Plan that gives $10 billion to states to create programs that invest in —and help grow — small businesses. Each state is tasked with designing the programs and products that reach a broad range of diverse entrepreneurs from this unprecedentedly large program.
Challenge
How do states structure capital, administer programs, and build the partnerships necessary to successfully leverage this federal investment to create jobs, support businesses, and permanently strengthen their state economies?
Opportunity
Supply Chain Finance (SCF) is an innovative and underutilized approach that states should consider in their SSBCI 2.0 portfolio. SCF ties financing to the promise of future cash flows (e.g., contracts, invoices), providing critical working capital to small supplier (e.g., B2B, B2G) businesses.
