EDC Microloan Program
EDC's Microloan Program provides funding for small businesses who cannot yet qualify for conventional bank financing. Our goal is to assist both start up and expanding businesses succeed by providing both financing and on-going technical assistance.
Terms
Our program provides small business loans up to $25,000 for businesses located in Boone, Callaway or Cooper Counties. The loans are funded at a fixed interest rate, currently 8.5%, and have no penalty for early repayment. The term of the loan can be from one to five years.
Use of Loan Proceeds
The loan proceeds can be used for working capital, and the purchase of inventory, equipment, furniture and fixtures. The loan proceeds cannot be used to refinance existing debt, pay an owner's salary, for down payment on real estate or for leasehold improvements.
Qualifications
In order to qualify for a microloan, the small business must be a for profit business, located in one of the three counties listed above and cannot qualify for adequate conventional financing. Other factors that would disqualify a business applicant are: convicted of a civil or criminal offense; past due on a government loan (including student loans); past due on child support payments; and recent bankruptcy. Business applicant also cannot have a current SBA loan from any program exceeding $50,000.
Credit, Collateral and Equity Injection
Microloan applicants are expected to demonstrate their creditworthiness - that there is is a reasonable assurance that the loan will be repaid. Enterprise does not use a minimum credit score to determine eligibility. Rather an applicant's credit history will be reviewed and reasonable circumstances surrounding an adverse credit situations will be taken into consideration. How an applicant has handled debt obligations in the past, or following any adverse credit situation, is very important.
Microloans also require collateral, including a personal guaranty from the entrepreneur. While specific collateral requirements vary in each circumstance, collateral is necessary to show that the applicant is willing to assume some of the risk for their business loan.
Equity injection, or the borrower's contribution of funds into the project, is also required for microloans. Enterprise does not use a set percentage of down payment, and the amount may vary in each circumstance, but the applicant's willingness to contribute their own funds into the project demonstrates their commitment to their business venture.
Technical Assistance Provided to our Borrowers
Our Microloan Program provides more than loans to borrowers. To ensure the success of micro entreprenuers, we provide one-on-one business advice, training seminars and act as a resource for other needed professional services. The success of our borrowers ensures that loan funds will be available to assist other small businesses in the future.
If you need help writing a business plan or resume, or help preparing financial projections for your business, please contact the Small Business Development Center, at 573-882-7096. This is a free service for microloan appliancts.
Application Process
To begin the application process, please call Mike Schrader at 573-819-3578. At the initial meeting, the details of the microloan business and how it may benefit your business will be discussed, as well as how steps of the application process. To be directed to the online application please click here. For a PDF of additional documentation needed to complete your application, please click here.
After the application is received, EDC's loan committee will meet with the applicant for an interview. If approved, the loan is funded. Generally, from the date of receiving the application to funding takes approximately two weeks.
Terms
Our program provides small business loans up to $25,000 for businesses located in Boone, Callaway or Cooper Counties. The loans are funded at a fixed interest rate, currently 8.5%, and have no penalty for early repayment. The term of the loan can be from one to five years.
Use of Loan Proceeds
The loan proceeds can be used for working capital, and the purchase of inventory, equipment, furniture and fixtures. The loan proceeds cannot be used to refinance existing debt, pay an owner's salary, for down payment on real estate or for leasehold improvements.
Qualifications
In order to qualify for a microloan, the small business must be a for profit business, located in one of the three counties listed above and cannot qualify for adequate conventional financing. Other factors that would disqualify a business applicant are: convicted of a civil or criminal offense; past due on a government loan (including student loans); past due on child support payments; and recent bankruptcy. Business applicant also cannot have a current SBA loan from any program exceeding $50,000.
Credit, Collateral and Equity Injection
Microloan applicants are expected to demonstrate their creditworthiness - that there is is a reasonable assurance that the loan will be repaid. Enterprise does not use a minimum credit score to determine eligibility. Rather an applicant's credit history will be reviewed and reasonable circumstances surrounding an adverse credit situations will be taken into consideration. How an applicant has handled debt obligations in the past, or following any adverse credit situation, is very important.
Microloans also require collateral, including a personal guaranty from the entrepreneur. While specific collateral requirements vary in each circumstance, collateral is necessary to show that the applicant is willing to assume some of the risk for their business loan.
Equity injection, or the borrower's contribution of funds into the project, is also required for microloans. Enterprise does not use a set percentage of down payment, and the amount may vary in each circumstance, but the applicant's willingness to contribute their own funds into the project demonstrates their commitment to their business venture.
Technical Assistance Provided to our Borrowers
Our Microloan Program provides more than loans to borrowers. To ensure the success of micro entreprenuers, we provide one-on-one business advice, training seminars and act as a resource for other needed professional services. The success of our borrowers ensures that loan funds will be available to assist other small businesses in the future.
If you need help writing a business plan or resume, or help preparing financial projections for your business, please contact the Small Business Development Center, at 573-882-7096. This is a free service for microloan appliancts.
Application Process
To begin the application process, please call Mike Schrader at 573-819-3578. At the initial meeting, the details of the microloan business and how it may benefit your business will be discussed, as well as how steps of the application process. To be directed to the online application please click here. For a PDF of additional documentation needed to complete your application, please click here.
After the application is received, EDC's loan committee will meet with the applicant for an interview. If approved, the loan is funded. Generally, from the date of receiving the application to funding takes approximately two weeks.
