MAIN STREET MICRO BUSINESS LOAN

Based on the significant number of applications already received, funding for the Main Street Micro Business Loan is fully subscribed. Based on the fact that the NJEDA’s application fee is non-refundable, the NJEDA is no longer accepting new applications. If you have any questions, please contact the NJEDA Call Center at 844-965-1125.

Please be advised, New Jersey State law prohibits most cannabis license and certification holders from receiving or continuing to receive an economic incentive from the NJEDA, including the Main Street Micro Business Loan. If the applicant, or any person who controls the applicant or owns or controls more than one percent of the stock of the applicant, has applied for or received a license or a certification from the New Jersey Cannabis Regulatory Commission (NJ-CRC), the applicant is ineligible for this program and should not proceed with an application. If an application is received from an applicant that meets this criteria, the application will be declined and the application fee will not be refunded.

NJEDA is currently developing financial assistance products to support cannabis and cannabis-related businesses – more information will be shared on the NJEDA website, when available.

Main Street Micro Business Loan will provide financing of up to $50,000 to eligible micro businesses in New Jersey with ten or fewer full-time employees and no greater than $1.5 million in annual revenues. The Program is the successor to the Micro Business Loan Program established by the NJEDA in 2019.

DOLLAR AMOUNT

Loans up to $50,000 for working capital expenses

BENEFITS

Low-cost financing with flexible terms to early stage micro businesses

No collateral is required

Reduced Fees

ELIGIBILITY

For-profit, non-profit, and home-based micro businesses with a business location in New Jersey and formed for at least six months prior to the date of application.

APPLICATION INFORMATION

The Micro Loan application will be available starting October 6^th, 2022 at 10:00 a.m. Eastern on the NJEDA Application Center.

Customers who have applied through the NJEDA Application Center portal in the past, will need to Log In on October 6^th and select the appropriate application. Customers who have not used the portal previously are encouraged to set up their profile in advance of the application launch date.

If you have trouble logging in to the portal please call Customer Care at 844-965-1125 or use the Live Chat feature on the NJEDA website.

If you were unable to attend the Micro Loan Information Webinar, please use the links below to access the webinar and the slides.

Webinar Recording EN | SP | Webinar Slides EN | SP

PROGRAM DETAILS

Main Street Micro Business Loan will provide low-cost financing of up to $50,000 to eligible micro businesses in New Jersey with ten or fewer full-time employees and no greater than $1.5 million in annual revenues. The Program is the successor to the Micro Business Loan Program established by the NJEDA in 2019.

With $20 million in funds allocated from the Main Street Recovery Fund, financing from the Main Street Micro Business Loan will cover future operating expenses such as inventory, equipment (that does not require installation or construction work totaling more than $1,999.99) and working capital to fund business operating expenses.

The loan will have a standard 10-year term and the interest rate will be 2 percent, with no interest and no payments due for the first year.

To help ensure all Opportunity Zone eligible tracts in New Jersey receive opportunities for investment that are equitable and inclusive, $8 million will be set aside to support eligible businesses and nonprofits with a primary business location within the 715 census tracts designated as eligible to be selected as an Opportunity Zone.

ELIGIBILTY

Nonprofit, for profit, and home-based* micro businesses interested in applying for the Main Street Micro Business Loan must meet the following eligibility requirements:

Must have less than $1.5 million in annual gross revenue for the most current fiscal year (to the extent the business has annual revenues)
Must have a credit score of at least a 600 from at least one owner to be eligible.
Must have no more than 10 full-time employees
- All employees must work in New Jersey as evidenced by WR-30 filings. There is no minimum employee number and sole proprietors are eligible.

Must be legally registered to do business in New Jersey, with a business location in New Jersey
Must be formed at least six months prior to the date of application, as evidenced by the date of formation/incorporation.
Must be in good standing with the New Jersey Department of Labor and Workforce Development (LWD) and NJ Department of Environmental Protection at the time of application to be eligible for a micro business loan
Must provide a current tax clearance prior to approval to demonstrate the applicant is in good standing with the NJ Division of Taxation.

One loan per business entity (verified by the business’s employer identification number, or EIN)

Applicants and recipients of the original Micro Business Loan are eligible for this loan if they meet all eligibility requirements.

A business entity with multiple locations (that is, all locations operate under only one EIN) will be limited to one application under this new product (under the sole business entity).

ELIGIBLE USES

Future operating expenses, which may be held as working capital to fund such future operating expenses. Examples include payroll, rent, mortgage, utilities, taxes, and inventory

Future purchases of equipment as long as installation and construction costs do not exceed $1,999.99

*Home-based businesses cannot use loan, proceeds for any residential costs (i.e. home mortgage/lease payments)

The following are not eligible uses:

Refinancing of existing debt
Personal, non-business obligations or costs incurred by
related entities
Construction
Equipment requiring installation or construction costs in excess of $1,999
Rolling stock – no cars, trucks, or vans can be purchased

Please be advised: New Jersey State law prohibits most cannabis license and certification holders from receiving or continuing to receive an economic incentive from the NJEDA. If the applicant, or any person who controls the applicant or owns or controls more than one percent of the stock of the applicant, has applied for or received a license or a certification from the New Jersey Cannabis Regulatory Commission (NJ-CRC), the applicant is ineligible for this program and should not proceed with an application. If an application is received from an applicant that meets this criteria, the application will be declined and the application fee will not be refunded.

RATES AND TERMS

Standard 10-year term
The interest rate will be 2 percent for this program, set at approval.

No payments or interest will accrue during the first year after closing. Payments of principal and interest will begin at the beginning of year 2.

No payment term amendments are allowed prior to end of 5th year – all other modifications unrelated to the payment terms may be permitted throughout the term of the loan. If after the 5th year any payment terms are modified, the business will no longer be eligible for forgiveness.

Borrowers may be eligible for the balance of the loan to be forgiven at the end of the fifth year.
To qualify for this forgiveness, the applicant must be

not in default
current on all loan payments with no delinquency of more than 90 days
able to certify that they are still open and operating as detailed in the loan agreement.

LIEN/COLLATERAL/SECURITY

No collateral is required
Risk Rating: expected to be substandard. If the risk rating is found to support an override to a lower risk rating, then staff will do so to reflect the appropriate rating.

TAX CLEARANCE CERTIFICATE

Division of Taxation Tax Clearance Certificate required. Certificates may be requested through the State of New Jersey’s Premier Business Services (PBS) portal online.

Under the Tax & Revenue Center, select Tax Services, then select Business Incentive Tax Clearance. If the applicant’s account is in compliance with its tax obligations and no liabilities exist, the Business Incentive Tax Clearance can be printed directly through PBS.

Instructions on Securing your NJ Tax Clearance Certificate

ADDITIONAL INFORMATION

Main Street Micro Business Loan– September 14, 2022 Board Memo | Program Specifications

Main Street Micro Business Loan Additional Funding– February 8, 2023 Board Memo

Application Checklist Applicant Checklist (SP) Frequently Asked Questions Frequently Asked Questions (SP) Main Street Recovery Program Rules Securing Your Tax Clearance Certificate Directions Informational Webinar Recording

QUESTIONS

It is recommended that you review the Frequently Asked Questions prior to see if your question has already been addressed.

For more information or to ask a specific question please send an email to smallbusinessservices@njeda.com and a team member will reach out to you.