Economic Development & Trade

Linked Deposit Programs

Updated February 8, 2000

Linked Deposit Programs designate a portion of state deposits in lending institutions to be used to help provide low-cost capital for specified investments in the state. Most programs target agriculture and small businesses. The state does not lend the money directly or guarantee loans. Instead, some of its deposits are made at below-market rates with the requirement that the institution that holds the deposits will pass along its interest savings to investors who meet criteria established by the state. Many states are using linked deposit to aid their economies.

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