Financing resources for cooperative businesses include grants, loans, guaranteed loans, revolving loan funds, equity capital, and crowd sourcing. Funding can come from Federal agencies, private-public partnerships, lending institutions, Community Development Financial Institutions (CDFIs), foundations, and other organizations. If your funding opportunity is not represented here, please contact us at CoopInfo@usda.gov.
The Equitable Economy Fund owns a diversified portfolio made up of ownership of preferred shares in cooperative businesses. Investors buy shares in the fund. The fund benefits from investment in cooperative preferred stock in one of three ways: 1. the cooperative pays target dividends (if agreed upon by the cooperative's board); 2. the cooperative buys back outstanding investor shares; or 3. the fund receives an agreed-upon allocation of pre-tax profits.
Through the New Market Tax Credit Program, the Community Development Financial Institutions Fund allocates authority to certified Community Development Entities to offer tax credits to investors in exchange for equity in the CDE. Using the capital from these equity investments, CDEs make loans and investments to businesses operating in low-income communities on better-then-market terms. Cooperatives may benefit by borrowing from CDFIs or from loans or investments by CDEs.