Is a Microloan Right for Your Small Business?
What is Microlending?
Microlending is a form of financing that provides small loans to entrepreneurs to encourage self-sufficiency. A microloan can typically provide financing from as little as $300.00 up to $100K depending on the lender's policy and the stability of the business. These funds are often used to start businesses within a community, but can also be used for working capital, inventory or supplies, furniture or fixtures, machinery or equipment, and more. There are some limitations; for example a microloan cannot be used to pay existing debts or to purchase real estate.
In 2015, a coalition of local lenders formed the MicroEnterprise Collaborative to help small businesses identify regional microlenders. The purpose of the Microenterprise Collaborative of Inland Southern California is to create and sustain businesses and jobs through micro-business development.
Qualifying for a micro loan
Each intermediary lender has its own lending and credit requirements, but generally lenders of microloans require less documentation and can issue loans a lot smaller than traditional banks. Qualifying for a micro loan is a simple process and usually starts by contacting the micro lender or the Inland Empire Small Business Development Center. Free resources are available to help small businesses take steps to become eligible and prioritize which components of a business will be analyzed and listed in an application. It’s important to understand that any credit deficiencies connected to the business could play a role in getting the loan.
Riverside welcomes Accion to Downtown
Finding access to capital continues to be a struggle for small businesses. Riverside entrepreneurs have several local resources for pursuing a microloan and the list of options just got larger. Accion, the largest nationwide nonprofit micro-and small business lending network, recently opened an office in Downtown Riverside. Accion has over 20 years of experience, lending to over 50,000 people in the US alone since 1991. They offer business owners flexible loans and a one-on-one lending approach that considers an entrepreneur’s strengths and opportunities. And as a nonprofit, Accion has rates that are highly competitive.
Riverside’s Commitment to Small business
It is our local entrepreneurs that give Riverside its unique character and charm. The City of Riverside is committed to our small business community and proud to be a partner in promoting Shop Small Business Saturday on November 26th. Members of the Economic Development Team would be happy to visit your small business, share resources, and learn first-hand about your business needs. For all of our resources, please visit the resource tab at the top of the page.