Subba Lama, owner of a Bubble tea shop in Queens, New York, was approved for a $50,000 five-year, below-market interest rate loan from a new city program that will help him pay for much-needed equipment, repairs and maintenance.
(Bloomberg) — Subba Lama, owner of a Bubble tea shop in Queens, New York, was approved for a $50,000 five-year, below-market interest rate loan from a new city program that will help him pay for much-needed equipment, repairs and maintenance.
The Nepal immigrant, who has lived in the US since 1999, is one of the fortunate loan recipients of the grant before the small business program stalls. Just under a month of its launch, New York City said Monday it is pausing the program due to an unanticipated influx of applications.
On Jan. 23, the city, in partnership with Goldman Sachs Group Inc. and Mastercard Inc., unveiled what it pegged as the largest public-private loan fund for small businesses in New York’s history. The program expected to fund 1,500 businesses but since its debut, New York City’s Department of Small Business Services received over 10,000 applications. The department is not clear on when it will resume accepting applications but said it is looking to expand the program.
“As we pause intake of applications, our partners are working at full speed to process those in the pipeline and disburse funds to eligible small businesses,” said Kevin D. Kim, commissioner of the New York City Department of Small Business Services in a statement.
The Department of Small Business Services said it notified Goldman and Mastercard of the pause. Goldman, which contributed approximately $50 million to the loan program, did not comment. Mastercard did not respond immediately for comment.
Loans ranging from $2,000 to $250,000 at a fixed below-market interest rate of 4%, regardless of the loan size were offered via the program, which arrives at a time when many small businesses continue to struggle to bounce back from the pandemic.
More than 4,000 private businesses, including chain stores and retail banks, shuttered in New York from 2019 to 2021 during the height of the pandemic, the city comptroller’s office said.
“I’m so excited and we are very happy, I’m getting a very low interest,” Lama, who opened his shop Momochai in 2017, told Bloomberg in an interview.
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