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SBA Microloan Program
The SBA MicroLoan Program provides working capital to smaller businesses. Under the MicroLoan program the SBA facilitates loans to intermediary non-profit lenders who in turn make non SBA guaranteed loans to for-profit businesses and non-profit child care centers. In 2016, these intermediary lenders loaned a total of $58 million to small businesses, with the average loan amount just under $15,000.
Examples:
- Office equipment for a graphic design company
- Operating capital for a non-profit child care center
- Promotional costs for a startup
MicroLoan Program In Detail
- Credit score above 660
- May require some collateral
SBA MicroLoans are distributed by a number of intermediate non-profit lenders who will each have their own qualifying process, therefore additional criteria may apply.
Benefits
- Set payments at regular intervals
- Can be used for a wide variety of purposes
- Relatively low interest rate
- Long repayment schedule
Drawbacks
- Lengthy application process
- May carry early payment penalty
- Variable interest rates may increase
If you’re confused or need clarification about the qualifying requirements for the SBA Loan Program, please contact us. We’ll be happy to help.
