Small Business Credit Initiative (Kentucky)

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Last modified on February 12, 2015.

EZFeed Policy

Place Kentucky

Applies to States or Provinces Kentucky
Name Small Business Credit Initiative (Kentucky)
Policy Category Financial Incentive
Policy Type Loan Program
Affected Technologies Biomass/Biogas, Coal with CCS, Concentrating Solar Power, Energy Storage, Fuel Cells, Geothermal Electric, Hydroelectric, Hydroelectric (Small), Natural Gas, Nuclear, Solar Photovoltaics, Wind energy
Active Policy Yes

Implementing Sector State/Province

Funding Source State Small Business Credit Initiative legislation, 12 U.S.C. §§5701-5710

Primary Website

Last Review 2014-09-15


The Kentucky Cabinet for Economic Development has been approved by the United States Department of Treasury to receive the Commonwealth of Kentucky’s allocation of federal funding to implement the Kentucky Small Business Credit Initiative (KSBCI).

The initiative includes three distinct credit enhancement programs designed to generate jobs and increase the availability of credit to small businesses by reducing the risk participating lenders, credit unions, and community development financial institutions assume. KSBCI will leverage funding from these private lenders to help finance creditworthy small businesses that would typically fall just outside a lender’s normal underwriting standards.

The three programs that compose KSBCI are: Kentucky Capital Access Program (KYCAP): Offers loan portfolio insurance to private financial institutions, thus encouraging them to lend to creditworthy small businesses, by providing a matching contribution to a lender’s loan loss reserve account when they extend credit to qualified small businesses. In the case of a loss, the lender may draw against the account to offset a loss.

Kentucky Loan Participation Program (KYLPP): Assists borrowers whose cash flow does not meet a lender’s coverage requirements by allowing CED to purchase (or participate in) a portion of the loan from the lender and offer the borrower, on that portion, a payment-free grace period up to 24 months.

Kentucky Collateral Support Program (KYCSP): Provides a pledged asset (cash) to a lender for consideration in making a loan to a small business, thereby enhancing the lender’s ability to underwrite the loan.

Policy Contact

Contact Name J. Don Goodwin
Department Kentucky Cabinet for Economic Development

Address 300 West Broadway

Place Frankfort, Kentucky
Zip/Postal Code 40601
Phone 502-782-1978