June 20, 2019

Charlotte Micro Loans to Prevent Bankruptcy

It’s a sign of the times that we too often write about helping small business restructure their enterprises or file for bankruptcy protection. When a piece of news comes across that might help small businesses stay afloat, we’re happy to write about it as well.

Small Business Lending Success

This article in the LA Times caught my attention because it highlights small business lending success.  Too often our small business clients complain that they can’t grow because their working capital is insufficient to buy necessary inventory or add to payroll. They also complain that lenders don’t want to deal with “small” or even “micro” loans.  Now, it appears the SBA may be part of the solution.

When President Obama signed the American Recovery and Reinvestment Act into law in February 2009 to create jobs and promote spending, the law included $56.1 million for microloans to small businesses, to be doled out through the Small Business Administration through September.

While some critics complain about the government’s economic stimulus efforts, some lenders and borrowers say the stimulus money for small businesses is working.

Targeted toward startup, newly established or growing small businesses, the microloans are short-term loans up to $35,000 each for working capital or inventory and equipment purchases. The intermediary lenders who distribute the loans can choose to lend more than that limit.

Charlotte-Area Micro-Lenders

A quick search of the SBA website revealed this list of non-profit intermediaries. As stated earlier, they can lend up to $35,000. The average loan size is $10,500.