Finally! The SBA (Small Business Administration) is loosening its grip and providing microloans of up to $50,000 to small businesses. In fact, the average microloan is $13,000. For some small businesses, that can make the difference when surviving a slow economy.
In an article published on Saturday, Oct. 16th in the L.A. Times titled “U.S. gives small firms more access to microloans”, Eric Zarnikow, who helps run the Small Business Administration’s loan programs says that for every loan, 1½ jobs are created or retained. When you consider that 80% of all businesses today have fewer than 10 employees, microloans play an important role in job creation…one loan and one job at a time.
Although the cost for lending microloans is more expensive than loaning larger amounts of money, it does seems that the SBA could find a better interest rate than 8 – 13% – especially in this economy. Even so, if you want more information about microloans for your mighty microenterprise, visit the SBA’s Microloan Program to find an approved intermediary in your area.