LEDC has deployed 456 loans totaling over $7.5 million since March 2020. Eighty-five percent of loans deployed went to entrepreneurs of color. With an average loan size of $16,614, our team reached and supported truly small, family-owned businesses during COVID-19.
Though the initial Paycheck Protection Program (PPP) left out CDFI lenders with direct access to the most vulnerable small businesses, LEDC maneuvered to ensure that it would be able to leverage these resources and connect them to small businesses who were having difficulty accessing the program. LEDC is pleased to have deployed 456 loans totaling over $7.5 million since March 2020. These forgivable loans have helped under-resourced businesses stay solvent and contributed to a more equitable economic recovery.
The pandemic has taken a particularly heavy toll on people of color and women. According to the Federal Reserve's 2021 Small Business Credit Survey, 85% of Hispanic-owned businesses reported financial stress compared to 79% of white-owned businesses. Furthermore, data from 2020 showed that Latino-owned small businesses had their PPP loans approved at half the rate of white-owned small businesses.
At LEDC, we work to break these unjust patterns. We are proud to share that 85% of the loans we deployed went to entrepreneurs of color and 51% to women-owned businesses. Furthermore, with an average loan size of $16,614, our team was able to reach and support truly small, family-owned businesses. By our estimates, these loans helped retain over 1,000 full-time jobs across Washington DC, Maryland, Virginia, and Puerto Rico.
The second round of PPP lending was vital for small businesses that did not receive or apply for funding in the first round. The first round of PPP lending was open for four months between April 2020 and August 2020. Over 50% of loans LEDC deployed in 2021 went to first-time borrowers.
Beyond deploying PPP loans to businesses in need, LEDC’s small business team has worked around the clock to ensure our clients’ loans are forgiven. Their support resulted in over 95% of PPP loans deployed in 2020 being forgiven by the Small Business Administration (SBA). Additionally, LEDC raised funds to provide debt reduction payments on behalf of our most vulnerable small business borrowers; and deployed below-market-rate, flexible, and patient loan products.
Figures like these demonstrate the critical importance of Community Development Financial Institutions (CDFIs) like LEDC. Unlike traditional lenders, CDFIs are mission-driven institutions that work to promote economic equity by providing financing and technical assistance to underserved entrepreneurs.
The road to recovery will be long and hard, but LEDC is committed to ensuring our communities access the resources they need to bounce back from this economic and health crisis.