Advantage Illinois Helps Lenders and Small Businesses Create Jobs by Enhancing Access to Capital

By Sean Prichard, Assistant Deputy Director Business Development, Illinois Department of Commerce and Economic Opportunity

Enhancing access to capital for Illinois businesses is a top priority. Small businesses are the backbone of the Illinois economy, and by working with the state’s banking community and venture capitalists, the Illinois Department of Commerce and Economic Opportunity (DCEO) and the Advantage Illinois program are here to assist. Through this program, we help entrepreneurs and small businesses start up, expand, and create new jobs at a faster rate.

Advantage Illinois is structured through participating institutions purchasing a portion of the loan, lowering the risk for lenders. Participating lenders accept business applications on a rolling basis and use their own underwriting standards and loan processes to provide financing to small businesses, with the Department’s share being primarily subordinated and at lower interest rates.

To aid our lending partners, the Department assists with loans and projects that have gaps preventing businesses from obtaining financing such as equity and collateral shortfalls, lack of historical cash flow (or startup businesses), low credit scores, and negative net worth. Ultimately, Advantage Illinois is designed to assist small businesses with gaining access to capital. We are working together for a better Illinois and know that small businesses are the backbone of the Illinois economy.

What can an Illinois Advantage Loan be used for:

• Real Estate (must be 51% or more occupied by the business)

• Inventory Purchases

• Equipment Purchases

• Leasehold Improvements

• Working Capital

• Accounts Receivable

What is not eligible for an Advantage Illinois Loan:

• Non-Profits

• Cannabis

• Investment Real Estate

• Goodwill related to change in ownership

• Tobacco

• Some restrictions on Industries

To date, Advantage Illinois has worked with over fifty lenders to assist businesses with financing, and we continue to add new lenders on a rolling basis. As this is not a direct loan program, we cannot do these participation loans without the assistance of our participating institutions. There are no fees for lenders to sign up or to utilize Advantage Illinois, nor are there fees from the State on term loans.

In 2021, Advantage Illinois was able to assist 51 business with financing, lending out over $7.8 million. As of Q3 2022, Advantage Illinois has assisted 75 businesses with financing, lending over $16.1 million. As we continuously support small business growth in Illinois, we invite lenders and businesses to reach out to learn more!

Advantage Illinois consists of two programs, the Standard Advantage Illinois Program, and the Fund for the Advancement of Minority Enterprises (FAME) Program.

History of Advantage Illinois

2010

o Advantage Illinois was funded under the State Small Business Credit Initiative, or SSBCI 1.0.

o The State of Illinois was allocated $78,365,264 and all the allocation was lent out to businesses.

2017

o Federal Government turned over SSBCI 1.0 to the States.

o Advantage Illinois became a staterun program and uses recycled funds from the original SSBCI 1.0 to loan to businesses in Illinois.

2021

o SSBCI 2.0 was created with $10 billion set aside under the American Rescue Plan Act of 2021

o Illinois is going through the applications with the federal government to receive another allocation to be used for lending.

o Treasury will disburse funds to the states after approval.

Since its inception, Advantage Illinois has impacted numerous entrepreneurs and small business startups, and we continue to work with the Treasury to receive additional funding. Advantage Illinois will continue its goal of partnering on more loans and projects, reaching more businesses throughout Illinois’ communities.

Lastly, we want to invite anyone who is interested in learning more about Advantage Illinois to reach out to the Department of Commerce & Economic Opportunity. This program is an extremely useful tool for Illinois businesses and the banking and lending community. We offer training seminars, presentations to both lenders and businesses, and are always excited to speak with those who are interested in learning more. Advantage Illinois is not possible without our lending partners, and we look forward to working with new participating institutions as we enhance access to capital for Illinois businesses.

For more information please visit www2.illinois.gov/ dceo/SmallBizAssistance/ AdvantageIllinois/Pages/ default.aspx or contact us at CEO. AdvantageIllinois@Illinois.gov.