Financing Your Business With A Microloan

If you have been looking to finance your start-up but the major banks have turned you down? then you may to consider getting funds from a microlender. Accion New York is the top microlender in New York.

Microloans generally cost more than bank loans, though some subsidize rates with grants. Accion’s rates range from 11% to 18%, and Business Outreach Center’s rates are about 8% to 12%. Banks charge around 9.25% to 11.25%

Compare to see if these loans may have better rates than a business credit card. Also check to see if the rate is fixed or variable. A fixed rate is better for cash management.

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Microloans, which typically range from $500 to $35,000 and are often doled out by nonprofits, are helping entrepreneurs citywide build day care centers, spruce up storefronts, outfit restaurants and launch beauty salons.

“It’s important for people to understand that there is this source of capital,” said Paul Quintero, interim CEO of Accion New York. “Microloans are credit for the unbanked or underbanked.”


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