Article 3. Borrowing From The Fund of California Financial Code >> Division 15.5. >> Chapter 7. >> Article 3.
The corporation is authorized to borrow money from the fund,
subject to the following terms and conditions:
(a) The interest rate on loans from the fund to the corporation
shall be six percent per annum;
(b) The maximum term of the loans to the corporation shall be for
Upon approval of the corporation to exercise the powers of
a small business development corporation pursuant to Section 32352,
the corporation shall cease to be liable for payment of interest on
loans made or to be made from the fund pursuant to this article.
The corporation shall make application in writing to the
Controller for loans from the fund.
Within five working days after receipt of an application
from the corporation for a loan from the fund, the Controller shall
disburse the proceeds of the loan to the corporation, unless:
(a) The corporation is in default on any previous loan from the
(b) In order to lend the amount requested by the corporation, the
Controller would be required to transfer to the fund amounts which
cumulatively would exceed the maximum amount specified in Section
If the Controller finds either subdivision (a) or (b) of
Section 32822 to be the case, the Controller shall deny the loan
application of the corporation.