DETROIT (WWJ) — Huntington Bank (NASDAQ: HBAN) announced a microlending partnership with the Michigan Economic Development Corp., the Pure Michigan Micro Lending Initiative, backed by a Huntington statewide commitment of $25 million — including $5 million in support of Detroit small business lending.
Through the Initiative, MEDC backing will make possible as much as $250 million in new total statewide lending by engaging other banks operating in Michigan that follow Huntington’s funding commitment in support of small business job growth.READ MORE: MRLA Offering Free Food Safety Classes for Kids
Huntington’s $25 million commitment will be distributed through lines of credit provided to community microlenders participating in the Initiative. The MEDC will provide initial credit reserves in support of the program, enabling up to $225 million in further bank partner funding for small business microloans. It is a new, repeatable model for microlending that other states can follow.
The program launched Monday in Detroit via community microlending partner Detroit Development Fund. It will target small business owners in need of very small loans beyond the scope of what traditional bank underwriting can finance.READ MORE: Whitmer: $32M Investment To Recruit, Retain Police Officers
Huntington will provide core lending funding to DDF of $5 million through 2018. In conjunction with MEDC backing and funding, and possible further foundation grant support and other bank funding, the total impact is expected to drive significantly more investment in Detroit small business development beyond Huntington’s initial funding, and serve as an example of what other Michigan communities can accomplish through locally created partnerships using the Initiative model.
The goal of attracting $250 million in Michigan microlending represents the largest microlending program ever established in the state, and is thought to be by far the largest-ever microlending effort in the country. According to the U.S. Microenterprise Census, total active microloans nationwide equaled $132.8 million in 2010, the latest industry self-reported data available as compiled by FIELD at the Aspen Institute.
Huntington Michigan executives Jim Dunlap and Mike Fezzey joined Gov. Rick Snyder today to announce the Pure Michigan Micro Lending Initiative from Detroit at E & S Uniforms and Apparel – a small business that recently launched in the city with support from microlending through the Detroit Development Fund and other community microlending sources.MORE NEWS: Deputies Find Human Remains In Mid-Michigan Soybean Field
Huntington’s support for the Pure Michigan Micro Lending Initiative complements a $2 billion commercial and small business lending partnership with the state announced at the 2011 Mackinac Policy Conference, and a $100 million commitment to Michigan affordable housing development announced from Grand Rapids with Lt. Gov. Brian Calley in 2012. Both multiyear programs have quickly outpaced their initially established timelines for Michigan lending and investment support.