NESDEC administers five loan programs:
- CD Pledge: NESDEC can purchase a CD for up to 50 percent of a small business loan (maximum $20,000), which can be used as security for a bank loan. By collateralizing part of the repayment, NESDEC makes it more feasible for the bank to make the loan.
- Supplemental Loan Program: Provides direct assistance to low-equity applicants seeking to develop secondary sources of income. There is a $10,000 limit on these loans, with up to a three-year repayment schedule. The interest rate charged is based on the risk involved, the term of the loan, security, and additional factors.
- Direct Loan and Loan Participation Program: Provides loans with higher limits (maximum NESDEC participation is $150,000) and longer terms (up to 25 years). It also has provisions for providing below-market interest rates.
- Intermediary Relending Program: A direct-loan program funded through the Office of Rural Development. The maximum amount of a loan cannot exceed $250,000 or 75 percent of the total project cost.
- Equity Fund: Provides funds for investing in small- and medium-sized businesses. These investments may be in the form of subordinated debt or stock options.