USDA Rural Development Business Programs
Category: Small Business Loans, State and Local Incentives
Business & Industry Loan Guarantee (B&I)
This program offers loan guarantees to lenders for their loans to rural businesses. Lenders need the legal authority, financial strength and sufficient experience to operate a successful lending program. This includes lenders that are subject to supervision and credit examination by the applicable agency of the United States or a State including:
- Federal and State-chartered banks.
- Savings and loans.
- Farm Credit Banks with direct lending authority.
- Credit unions.
Other non-regulated lending institutions may also be approved by the Agency under the criteria of the OneRD regulation.
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Rural Economic Development Loan & Grant Program (REDLG)
The Rural Economic Development Loan and Grant program provides funding for rural projects through local utility organizations. USDA provides zero-interest loans to local utilities which they, in turn, pass through to local businesses (ultimate recipients) for projects that will create and retain employment in rural areas. The ultimate recipients repay the lending utility directly. The utility then is responsible for repayment to USDA.
USDA provides grants to local utility organizations which use the funding to establish Revolving Loan Funds (RLF). Loans are made from the revolving loan funds to projects that will create or retain rural jobs. When the revolving loan fund is terminated, the grant is repaid to USDA.
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Rural Energy for American Program (REAP)
The program provides guaranteed loan financing and grant funding to agricultural producers and rural small businesses for renewable energy systems or to make energy efficiency improvements. Agricultural producers may also apply for new energy-efficient equipment and new system loans for agricultural production and processing.
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