Small Businesses Are Great; Not Their Access to Credit
I love small businesses. I love that sign on the street corner saying “opening soon” and the anticipation of being one of the first patrons to walk in and experience something new. From the local coffee shop, to the independent barber where I get my haircut, to the arborist who recently trimmed my trees, I love small businesses. Small businesses are built by my friends, my neighbors, my family. Small businesses want to know what I think and listen to my ideas when I speak to them. Small businesses shape the culture of my community and they are a part of my everyday life. I’m willing to bet they are part of yours, too.
But small business loans aren't always so easy to come by, especially if you're a minority. The small business loan denial rate for minorities is 30%, more than twice that of non-minority groups (only 12.3%). You can change this pattern. A journey of a thousand miles begins with one step. Take a step by downloading our free Issues Brief to learn how to bring Community Microfinancing into your community.
Not only can small businesses give us a sense of purpose and connection, they are also a driving force of the economy. Small businesses provide a range of products and services to our community members, larger business, non-profits, and government agencies. The Small Business Administration indicated that small businesses account for 63% of net new private sector jobs and 48.5% of private sector employment. Just imagine if all the small businesses just suddenly disappeared…
Fortunately, that’s not likely to happen, if we do something about it NOW to help small businesses thrive. The #1 barrier to small business growth is access to credit.
How does your credit union’s business loan portfolio look right now? And about how much of that is business loans? Do you think that’s good enough? Business loans aren’t really what your credit union does? Small business loans don’t make the bottom line look so great? Are micro small business loans downright scary?
I challenge you to think again:
Does your credit union exist to serve the needs of its members? Are many of your members small business owners? In your credit union’s mission, do you strive to improve the financial capabilities and wellbeing of your community? Are small businesses in your community financially stressed because of a lack of access to quality credit options?
If the answer to any of this is YES, here’s the exciting part:
If your credit union doesn’t have a small business or micro lending portfolio, you can get started with small efforts. If you’re looking to better enable small business borrowers for success through your existing small business lending program, look no further. Wanting to support small businesses doesn’t have to present major risk or stress out your board. By implementing the Community Microfinance Small Business Lending program at your credit union, you will be giving a much needed option to low-income entrepreneurs from primarily underserved and underrepresented groups to start their own businesses. The program pairs loans between $1,000 and $25,000 with financial education and promotion of businesses via community boards in credit union branches.
|Alterna Savings Credit Union has been running this program for 15 years and in that time, nearly $3.6 million has been lent and over 60% of borrowers have hired others to help expand their businesses.
The repayment rate was 96%.
Take one small step to support small business owners; take that step with us right now.
OR if you’re ready to sign up right now, complete this short form to join more than 25 credit union peers who have already committed to testing.