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SALT LAKE CITY — The Suazo Business Center announced Thursday that it has received a federal designation that will allow it to launch a loan program to serve Utah’s Hispanic and other minority communities.
The center — whose Salt Lake, Ogden and St. George locations offer resources for Latino and other diverse entrepreneurs — was recently designated as a Community Development Financial Institution by the U.S. Treasury Department.
The designation is given to organizations focusing on financial services for low-income and other marginalized communities. It will allow the center to access new streams of funding to create a loan fund with the Treasury Department, banks and other organizations.
The center is currently focused on building that fund and hopes to start approving loans by winter 2024. It aims to help an estimated 50 businesses the first year.
Silvia Castro, the center’s president and CEO, said the center hopes to fill a gap for businesses looking for loans of under $50,000.
“It’s a niche that has not been met well at all,” Castro said. “That under $50,000 — that little push, that capital to stablize, to grow — is just not well met because, frankly, it takes a lot of training on new things and understanding of cash flow to get to that first $50,000. It’s just that first step to get people comfortable with credit and learn what cash flow can do for you that really stabilizes businesses.”
This new designation that the Suazo Center has will permit many of our people to be successful. Success is possible with hard work, but one also needs this support.
–Sen. Luz Escamilla, D-Salt Lake City
The new loan fund will build on the center’s existing work, which has included some small-scale loans since 2007. The center’s current $350,000 annual loan budget ran out six month into its fiscal year because of high demand. That $350,000 translated to twelve business loans.
“Unfortunately, because we haven’t had this, we’ve had to turn people away,” Castro said. “There hasn’t been a lack of need, but we did not have the pool to meet that need.”
The loan fund comes at a time when pandemic-era financial assistance has dried up, interest rates are rising and banks are becoming more conservative with their lending, Castro said.
Utah state Sen. Luz Escamilla, whose district previously included the center’s Salt Lake location, said the designation will be critical to many businesses that are ready to grow but lack the capital to take that next step. She stressed that the center’s designation is especially meaningful given the fact that Latina women are opening businesses at a rate six times faster than other groups in the U.S.
“This is a victory for everyone,” Escamilla said in Spanish. “This new designation that the Suazo Center has will permit many of our people to be successful. Success is possible with hard work, but one also needs this support.”
Gladys Gonzalez, the center’s founder, is an example of the impact of small business loans. The late Sen. Pete Suazo, the center’s namesake, helped Gonzalez secure a microenterprise loan that kept her from closing the doors on her Spanish-language newspaper at the time. The paper would act as a springboard for Gonzalez’s launch of the center, which has helped create 5,000 small businesses.
“Accent doesn’t make a difference when you have a dream,” Gonzalez said. “If you have a business, you can take it wherever you want to take it.”