The Global Entrepreneurship Network (GEN) and Hello Alice have announced the creation of a five-year, $70 million fund that aims to improve equitable access to credit and capital for small businesses in underserved communities.

The Equitable Access Fund is designed to address significant untapped demand for business credit among small businesses owned by women, veterans, BIPOC (Black, Indigenous, and people of color), Latinx, people with disabilities, and LGTBQ communities. According to Hello Alice, only 25 percent of small business owners have applied for a business credit card, and 85 percent of those applications were denied due to poor credit or lack of credit. The new fund aims to unlock an estimated $1 billion in credit access for thousands of small businesses. To that end, the fund will provide guarantees, loan loss reserves, and cash collateral deposits to enable financing partners to increase their risk tolerance and unlock credit access for underserved high-potential, credit-challenged small business owners.

The fund is backed by investments from Wells Fargo. First National Bank of Omaha—Hello Alice’s credit card issuer—is a financing partner of Hello Alice. Key partners in GEN’s Equitable Access Program include Mastercard and the Ewing Marion Kauffman Foundation.

“There is an estimated $40 billion annually of unmet financing demand from BIPOC-owned employers that applied for financing, and an estimated $1 trillion in unmet financing demand from all small businesses nationally,” said Hello Alice co-founders Elizabeth Gore and Carolyn Rodz.

“Small businesses are a critical contributor to the economy and to building generational wealth,” said Wells Fargo Foundation president Otis Rolley. “We need to create more pathways for historically marginalized small businesses to grow and prosper.”

(Photo credit: Getty Images/Jacob Lund)