ADDRESSING THE CAPITAL GAP IN DISTRESSED COMMUNITIESThe NMTC provides gap financing, allowing investment to flow to areas underserved by conventional lenders. nvestors and firms often lack sufficient data to assess property value or consumer demand in low-income communities, where informal economies distort data. The capital gap deprives businesses of the investment dollars needed to set up shop and expand, and it prevents communities from financing new healthcare facilities, community centers, and cultural amenities.
Example: Imagine a nonprofit needs $15 million to construct a new facility and to meet growing demand, but they can only secure a combination of $12 million from donors and conventional lendors. The NMTC fills the $3 million gap and makes the expansion possible.