GROW South Dakota Valuable Partner
Friday, April 05, 2013
Since 1978 GROW South Dakota, also known as NESDEC, a 501 (c)(3) nonprofit corporation, has managed a revolving loan fund that serves new and existing business owners in northeast South Dakota. To meet loan demand, additional capital was needed to facilitate the expansion. -USDA Rural Development’s Intermediary Relending Program (IRP) has been a valuable partner in funding the continued expansion and shared success of the revolving loan fund. GROW South Dakota received its 10th IRP loan in August of 2012 continuing an 18 year partnership with USDA Rural Development.
The additional IRP funds from USDA Rural Development enabled rural communities in South Dakota access to low-interest loans that were otherwise not available. Since 2009, 98 businesses in 28 different South Dakota communities have received more than $6 million in financing through GROW South Dakota’s relending of IRP funds. Combined with other lenders, banks and development corporations, created a combined $15.6 million in total projects, creating or maintaining 760 local jobs.
The success in re-lending of the funds is not simply that businesses have access to affordable interest rate loans, but the reinvestment in the community that occurs with the business cost savings. For example, a business was able to purchase a new packaging machine with IRP funds and has seen their profit margin increase from 23.6% to 34.6%. With the increased productivity they have hired additional employees. Employees that will live, work, and shop in the community. The IRP funds have impacted the residents and the quality of life they experience.
Another example is a rural South Dakota community, population 1,200, which had five different businesses apply and receive IRP loan funds since 2009. Those businesses represent manufacturing, packaging, and retail industries -all of which supply important services to the community and allow the residents to live, work and shop locally.
Rural Development’s partnership with GROW South Dakota has provided essential capital to businesses that enables rural communities to thrive