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Promising Practice: No-interest Revolving Loans

Promising Practice: No-interest Revolving Loans

Photo of Maisha Bahati

“I’m very grateful for the equity program. I’m a huge believer in the fact that equity is how I got into this position. I wouldn’t have gotten here had I not had the program or the funding that was provided through CORE. It’s been life-changing.”

– Maisha Bahati, CEO of Crystal Nugs

Owner Spotlight: Maisha Bahati

Crystal Nugs

Jurisdiction: Sacramento

Maisha Bahati is the CEO of Crystal Nugs, the first Black and woman owned non-storefront delivery business in Sacramento. She was one of the first equity applicants in Sacramento’s Cannabis Opportunity Reinvestment and Equity (CORE) Program and is in the process of expanding her business with a retail storefront. Maisha is also an advocate for policy reform. Her goal is the sustainability and success of equity businesses.

Sacramento’s no-interest revolving loan program, CORE Capital, is one of only two operational loan programs for equity businesses in the country. The other is in Oakland. Since establishing CORE Capital, Sacramento has issued over 90 loans totaling more than $4 million to cannabis equity businesses. CORE Program members can apply for a first-time loan of up to $50,000 per business location. Follow-on loans of up to $50,000 are available if businesses demonstrate that they have:

  • Spent 70% of previous loan
  • Made payments on time
  • Signed lease or own a location
  • Are compliant with licenses, permits, and taxes
  • Remain verified in the CORE program

“We used the loan to update our security equipment, purchase equity products, and purchase a vehicle for our delivery service. We got a lot out of it. We were able to hire someone else because of our delivery vehicle.”

– Bahati

Sacramento’s Office of Cannabis Management administers CORE Capital internally and maintains a dedicated website that lists eligible and ineligible use of proceeds, required documentation, forms, loan data, frequently asked questions, and details on the 6-year repayment process.

“The loan process was confusing at first. A lot of documentation is required with the application Applicants need to be aware of processing times and what is required to receive the loan so there are no surprises.”

– Bahati

Traditional financial options are unavailable to cannabis businesses, making these local loans and grants vital in achieving equity goals throughout the state. Getting money directly into the hands of equity businesses helped level the industry playing field and uplifting communities harmed by the War on Drugs. Jurisdictions interested in cannabis equity should seriously consider implementing a no-interest revolving loan program to support their equity applicants.

“Equity is not everywhere and sometimes it feels like equity stops at the Office of Cannabis Management. The rest of the world doesn’t look at you and offer help because you’re a social equity applicant. Equity is extremely important and all of the opportunities that are presented help.”

– Bahati