Michigan Women Forward (MWF), a Detroit-based community development financial institution (CDFI), has announced the launch of a $10 million fund that will finance loans to women and entrepreneurs of color who would not qualify for traditional bank loans.

The Michigan Economic Opportunity Fund is financed by contributions from Huntington National Bank ($1.5 million), Ballmer Group ($1.5 million), the Michigan Economic Development Corporation (MEDC) ($1 million), and $2 million from private funders. In addition, MEDC is providing a loan of approximately $1.5 million from its State Small Business Credit Initiative. The fund will support business owners in underserved communities with loans of up to $50,000. In 2022, MWF made 88 loans totaling $2.45 million invested mainly in women-owned businesses.

Black-owned businesses are two to three times more likely to be denied credit and face higher interest rates on bank loans when compared to other borrowers, MLive reports.

“We know that systemic inequities impede access, opportunity, and outcomes in economic mobility,” said Ballmer Group Southeast Michigan executive director Kylee Mitchell Wells in a statement to MLive. “[CDFIs] play a vital role in ensuring that low-cost capital is available to more communities and individuals—such as entrepreneurs of color and women—who have been locked out of traditional capital markets.”

“The Michigan Economic Opportunity Fund will change the trajectory of a Michigan small business owner,” said MWF president Carolyn Cassin. “This funding will build a sustainable business, generate wealth for that individual and ultimately, impact the state’s economy, and create jobs in the communities in which we live.”

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