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Five-year plan aims to bolster community lending resources and unlock access to affordable capital for America’s underserved small business owners

In celebration of National Small Business Week, today Sam’s Club and the Sam’s Club Giving Program announce the Small Business Economic Mobility initiative, a five-year investment in small business growth through increased access to capital and borrower education. Serving small business owners and entrepreneurs as members for 32 years, Sam’s Club launches this philanthropic initiative to respond to the national struggle for small business owners in low-to-moderate income communities to attain affordable loans and navigate the lending process. By bringing together expertise, business initiatives such as the recently announced Business Lending Center and philanthropic investments, Sam’s Club and Sam’s Club Giving Program are uniquely positioned to help small business owners access affordable capital.

To launch the initiative, Sam’s Club and the Sam’s Club Giving Program share the first round of grants totaling $13.6 million to eight national nonprofit organizations that provide access to capital and education to underserved U.S. small businesses including women, minorities and veterans. Through further investments in small business advocacy and nonprofit organizations, the five-year initiative will:

• Enable nonprofit Community Development Financial Institutions (CDFI’s) to make 5,000 loans to underserved small businesses with focus on women-, minority- and veteran-owned businesses with fewer than 20 employees
• Unlock $100 million in new capital from non-bank, community lending resources to low- and moderate- income small business owners through 2019
• Support 28,000 jobs in the small business community
• Reach one million underserved small business owners with education on responsible lending and better borrower practices.

”Our founder Sam Walton started Sam’s Club to help small businesses get access to big business savings, save money and grow their businesses as a result,” said Rosalind Brewer, president and CEO of Sam’s Club. “Through this philanthropic investment, our founders’ legacy is carried forward by fortifying our communities’ lending resources to increase access to capital and borrower education for small business owners. In collaboration with dedicated nonprofits, we are proud to open doors for small business and strengthen the backbone of the U.S. economy.”

Across the country, small businesses and entrepreneurs report that access to capital is a major barrier to growth. According to The State of Small Business Lending report published by Harvard Business School fellow and former SBA Administrator Karen Mills, the share of small business loans provided by banks 20 years ago was about 50 percent, compared to only 30 percent in 2012. Specifically, minority owned businesses typically encounter higher borrowing costs, receive smaller loans and see their loan applications rejected more often by banks, according to a Minority Entrepreneurship Report published by UC-Berkeley and Wayne State University. CDFIs, non-profit mission-driven lenders, specialize in helping those businesses attain affordable loans bundled with education. The Small Business Economic Mobility initiative helps CDFIs to scale loans and reach more underserved business owners more broadly.

“Economic projections indicate that in the future a growing number of Americans will be working for themselves,” said Joyce Klein, Director of the Aspen Institute Microenterprise Fund for Innovation and Effectiveness, Learning and Dissemination (FIELD). “The for-profit and nonprofits that can provide capital and resources for this segment seek to leverage technology to lower their costs and embrace new partnerships in order to compete and to better serve this growing market. The Sam’s Club Giving Program is a welcome new funder and contributor to the national conversation about how to advance this diverse entrepreneurial community and to meet their needs for capital and knowledge to build their businesses.”

The first round of grants in the Small Business Economic Mobility initiative includes programs to:

           

Partner

     

Grant Amount

     

Program

Accion U.S. Network       $1.8 million       Support the continued development and improvement of an online lending and financial education platform that will reach new groups of business owners seeking capital online Association for Enterprise Opportunity (AEO)       $2.5 million      

Expand cross-sector collaborations to bring innovative solutions to community and nonprofit lenders that will increase the flow of capital to underserved small business owners

The Aspen Institute - Fund for Innovation, Effectiveness, Learning and Dissemination (FIELD)

     

$450,000

     

Fund an applied research and learning process designed to increase the use and sustainability of shared platforms in the microenterprise industry, and to advance the further development of the FIELD

microTracker data platform

Community Reinvestment Fund (CRF)       $500,000      

Support the continued development and improvement of an online lending platform that streamlines the Small Business Administration Government (SBA) guaranteed loan process for CRF and multiple lenders

National Association of Latino Community Asset Builders (NALCAB)       $2 million      

Provide local Latino-serving non-profit small business development agencies and lenders with subgrants, training and technical assistance to directly serve Latino owned micro businesses and entrepreneurs in 19 states and the District of Columbia

The Opportunity Fund       $750,000      

Scale access to affordable loans for California-based small businesses leveraging a unique model that enables loans to be repaid through an automated small fixed percentage payment from the business owner’s sales, helping entrepreneurs to prevent or recover from debt traps perpetuated by high-cost, short-term alternative lenders

VEDC

(Valley Economic Development Center)

      $2 million      

Serve as a loan loss reserve to unlock $20 million in funds for micro and small business loans. Help VEDC establish the National Microfinance Fund in at least 10 U.S. markets expected to exist in perpetuity

 

The Sam’s Club Giving Program’s Small Business Economic Mobility initiative will also give the Opportunity Finance Network (OFN) a $3.6 million grant to raise awareness about predatory lending and educate small business borrowers.

The Sam’s Club Giving Program’s Small Business Economic Mobility initiative is part of the Walmart Foundation’s focus on creating economic opportunities for individuals globally. The Foundation is also committed to helping people live better through philanthropic efforts in the areas of sustainability and community. Sam’s Club has a long history of giving back to the communities we serve through product donations, grants to local nonprofits and civic organizations and Associate volunteerism. In 2014, 642 Sam’s Club locations donated the following:

• $150.9 million in cash and in-kind gifts to local nonprofits including donating the equivalent of more than 62 million meals to Feeding America
• $6.57M in community grants to local nonprofits focused on a variety of causes from Hunger Relief and Nutrition to Environmental Sustainability
• 247,000 associate volunteer hours resulting in $3.73M in donations to local nonprofits

In 2015, Sam’s Club is a Bronze Sponsor of the SBA’s National Small Business Week, a Diamond Sponsor for the U.S. Chamber of Commerce’s America’s Small Business Summit and Dream Big Small Business of the Year Award program and leading sponsor of the YEA! Young Entrepreneurs Academy, which provides entrepreneurial education to grade school students in more than 100 U.S. communities. For more information on Sam’s Club’s investment in our communities, read the recently released 2015 Global Responsibility Report.

About Sam’s Club and the Sam’s Club Giving Program

Sam’s Club, the nation’s eighth largest retailer and a leading U.S. membership club, offers savings and surprises to millions of members in 649 U.S. club locations and at SamsClub.com. The Sam’s Club Giving Program, established by the Walmart Foundation in 2008, has granted $18 million to date in support of micro- and small business prosperity, economic mobility and opportunity. For more information on national or local giving by Sam’s Club or the Sam’s Club Giving Program, visit SamsClub.com/giving.

Sam’s Club Media RelationsCarrie Foster Moore, 1-800-331-0085SamsClub.com/newsroom