Charles Schwab Bank, BBVA Compass and Mechanics Bank are among the latest investors in a California microfinance firm that specializes in small-business lending.
Opportunity Fund said Tuesday that it has raised $27 million in new debt financing, led by Schwab. The nonprofit firm uses debt financing from banks and other sources, as well as philanthropic gifts, in order to make loans to small businesses in California.
"Small-business owners simply don't have equal access to healthy funding sources and the necessary resources to help them grow their businesses," Opportunity Fund Chief Executive Eric Weaver said in a press release. "Our goal is to change that."
During its most recent fiscal year, Opportunity Fund lent $60.5 million to small businesses. The loans average $20,000, and they carry annual percentage rates between 8.5% and 18%, according to the firm.
Opportunity Fund and other nonprofit small-business lenders are on the front lines of efforts to help companies that have taken out high-cost online loans and can no longer manage their debt. The firm seeks to refinance financially strapped borrowers into less expensive loans.