South Carolina § 33-37-1040 - Participating financial institutions; functions and duties.

§ 33-37-1040. Participating financial institutions; functions and duties.

A participating financial institution originating a loan to a small business pursuant to this article shall:

(1) use its existing business and banking network to market and perpetuate the CAP so as to promote economic development among small businesses in South Carolina;

(2) provide financing to small businesses for their business purposes including, without limitation, expansion, start-up, purchase of fixed assets or inventory, facility or technology upgrading, and working capital;

(3) limit loans outstanding to one small business borrower pursuant to this article and the CAP to an aggregate balance outstanding of two hundred fifty thousand dollars or a lesser amount the BDC determines, in the exercise of its discretion for the benefit of the CAP and the small business community at large in this State;

(4) limit loans made pursuant to this article and under the CAP to those that are not guaranteed or otherwise assisted by another governmental entity or program;

(5) set aside an amount of at least one and one-half percent but no more than three and one-half percent of the principal amount of the loan, into the loss reserve account;

(6) obtain from the small business an amount equal to the reserve contribution made by the participating financial institution with respect to the loan;

(7) forward the funds collected and determined pursuant to items (5) and (6) to BDC for deposit into the loss reserve account together with a written report in the form and with the content BDC prescribes; and

(8) report annually to BDC, in the manner and with the supporting information BDC prescribes, the outstanding balance of loans made by it pursuant to the CAP, and a projection and estimate of loans it anticipates making pursuant to the program in the succeeding year.

HISTORY: 2005 Act No. 157, SECTION 4.A, eff June 10, 2005, applicable for taxable years beginning January 1, 2006; 2015 Act No. 60 (S.389), SECTION 1, eff June 4, 2015.

Effect of Amendment

2015 Act No. 60, SECTION 1, in (7), deleted "of this section" following "items (5) and (6)".