The Case for a Co-op Mutualist Fund: Why Co-ops Should Invest in Themselves - Non Profit News | Nonprofit Quarterly

"Cooperatives offer communities a vital tool to build collective wealth; meet social, economic, cultural, and ecological needs; and boost local power. Yet federal support for cooperative small business development is extremely limited. In fiscal year 2024 alone, the US Small Business Administration approved 70,242 loans under the 7(a) guaranteed loan program to private small businesses, totaling more than $31 billion. By contrast, since 2020, there have been four 7(a) loans made to co-ops."

"There is one federal program dedicated specifically to supporting co-ops: the Rural Cooperative Development Grant (RCDG) program, housed at the US Department of Agriculture (USDA). Funding for the program has remained stuck at $5.8 million- an annual allocation that works out to less than two cents per capita. Over a third of Americans hold cooperative memberships in credit unions alone."

"For that pittance, over the past decade RCDG has enabled co-op development organizations to provide specialized technical assistance, business support, education, and training to more than 8,000 cooperatives and mutuals in rural areas. It has supported the incorporation of more than 1,000 businesses and created or saved more than 17,000 jobs since 2015. This year, the administration of President Donald Trump has sought to zero out this modest allocation, though Congress appropriated full funding for the program for Fiscal Year 2025."

Cooperatives provide tools to build collective wealth, meet social, economic, cultural, and ecological needs, and increase local power. Federal support for cooperative small business development remains extremely limited. In fiscal year 2024, the SBA approved 70,242 7(a) loans totaling over $31 billion to private small businesses, while since 2020 only four 7(a) loans went to co-ops. The Rural Cooperative Development Grant (RCDG) at USDA is the sole federal co-op program and has been funded at $5.8 million annually—less than two cents per capita. RCDG supported specialized assistance to over 8,000 cooperatives, helped form 1,000+ businesses, and created or saved 17,000+ jobs since 2015. With traditional lenders largely excluding co-ops, co-ops have the capacity to self-finance development.

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