When a bank says no, a nonprofit microlender can say yes. See how small loans — paired with mentoring and financial education — helped real entrepreneurs grow their businesses.
1 A Catering Side Gig Becomes a $2 Million Business
Before a chance meeting in 2013 with Accion, a nonprofit microlender, Kris Schoenberger pulled in $20,000 to $30,000 annually through his mobile catering company, BBQ’d Productions. Catering was his side gig at the time.
A little more than a year later, Schoenberger’s business in Third Lake, Illinois, north of Chicago, had grown to include a full-service restaurant. His revenue from July 2014 to July 2015, the first year of business for the restaurant, soared to $2 million.
Schoenberger gives a lot of the credit to Accion, which lent him about $7,500 to help upgrade his catering operation from a grill in the back of his truck to a fully equipped catering trailer. He says an Accion loan officer helped him save nearly $6,000 on the trailer.
2 Microlenders Teach, Not Just Lend
“Not only do they give you the money, they also teach you how to make the most out of that money. I would not be where I’m at today if it weren’t for them.”
“Not only do they give you the money,” Schoenberger says, “they also teach you how to make the most out of that money. I would not be where I’m at today if it weren’t for them. Any time I have a problem or question, I can always call them.”
This type of financial and business education is central to the mission of most nonprofit microlenders. Rather than lending money and leaving borrowers to fend for themselves, microlenders provide counseling and mentoring to help entrepreneurs succeed.
Nonprofit microfinance organizations also help people in underprivileged and underrepresented communities access the capital they need to start businesses, buy homes or build credit, often when they can’t get financing through a traditional bank.
3 Capital When Banks Pull Back
In recent years, microlenders have become more visible as traditional lenders, such as banks, pulled back on small-business lending during and after the recession.
Microlending has been growing in the U.S., according to the latest information from the Aspen Institute, whose FIELD program collects data on microlenders across the country. Total microloans disbursed in the U.S. jumped to $209 million in 2014, up 47% from $142 million the previous year. The total number of microloans rose to 56,351, a gain of 49% from 37,927.
Germaine Seufert took out an $18,000 loan from Accion, after being declined by a bank, to buy a bus to help expand her organization’s summer camp. Seufert is the director of Consultants for Children, a Colorado company that provides in-home and small-group services for children with autism and other developmental disabilities.
Before approving the loan, Accion made a site visit, called business references and looked over the organization’s books. The whole process took about four weeks, Seufert says.
When she went to Accion to refinance the loan to buy a second bus, the process went much more quickly. “It took more time for me to pick out the vehicle,” she says. “But once we had the appraisal done, they immediately approved the loan.”
4 Inside Accion and Opportunity Fund
Founded in 1961, the global nonprofit Accion helps millions of people in more than 20 countries secure financing. Among those countries: the United States.
The organization offers microloans and general small-business loans in the U.S. in amounts ranging from $200 to $750,000. Accion offers loans to help businesses in specific industries — including child care, food and beverage, spa and salon — as well as those that are in the nonprofit sector or aiming to go green. Accion’s lending activity in the U.S. is committed to helping underserved entrepreneurs, including women, veterans, people with disabilities, Native Americans and other minority business owners.
Many nonprofit lenders are local, serving specific regions or communities. California-based Opportunity Fund is one. The microlender has been serving residents of the state since 1994, with more than $100 million in microloans.
Laura Hanson, a co-owner of Watershed Nursery in Point Richmond, California, was one of those people. In 2008, Hanson borrowed $10,000 from Opportunity Fund to expand the nursery, which she and her co-owner started in the backyard. “They were offering better rates. It felt more attractive and straightforward and helpful,” Hanson says. “We had a person who was on our account who was accessible and answered questions. I felt like they were there to help us.”
In addition to microloans to small businesses, Opportunity Fund also promotes microsavings. This program matches every dollar saved by low-income clients with $1 from Opportunity Fund and $1 from donors. Opportunity Fund doesn’t simply give money, though. The organization provides basic financial literacy education to clients to help them learn to budget, save and spend wisely.
Billshark · Bill Negotiation Experts Helping consumers and small businesses stop overpaying on recurring bills.
Frequently Asked Questions
What is a nonprofit microlender?
A nonprofit microlender provides small loans to entrepreneurs, often people in underprivileged and underrepresented communities who can't get financing through a traditional bank. Rather than lending money and leaving borrowers to fend for themselves, microlenders also provide counseling and mentoring to help business owners succeed, along with the capital they need to start businesses, buy homes or build credit.
How much can you borrow through Accion?
Accion offers microloans and general small-business loans in the U.S. in amounts ranging from $200 to $750,000. It lends to businesses in specific industries such as child care, food and beverage, and spa and salon, as well as nonprofits and businesses aiming to go green. Founded in 1961, the global nonprofit helps millions of people in more than 20 countries secure financing.
How did a microloan help Kris Schoenberger's business grow?
Accion lent Kris Schoenberger about $7,500 to upgrade his catering operation from a grill in the back of his truck to a fully equipped trailer, and a loan officer helped him save nearly $6,000 on it. His mobile catering company, once earning $20,000 to $30,000 a year, grew to include a full-service restaurant, with revenue soaring to $2 million in its first year.
Is microlending growing in the U.S.?
Yes. According to the Aspen Institute's FIELD program, total microloans disbursed in the U.S. jumped to $209 million in 2014, up 47% from $142 million the previous year. The total number of microloans rose to 56,351, a gain of 49% from 37,927. Microlenders became more visible as banks pulled back on small-business lending during and after the recession.
Do microlenders offer more than just money?
Yes. Financial and business education is central to most nonprofit microlenders' mission. Opportunity Fund provides basic financial literacy education to help clients budget, save and spend wisely, and promotes microsavings by matching every dollar saved by low-income clients with $1 from the fund and $1 from donors. Borrowers describe accessible account contacts who answer questions and offer help.
How a Microloan Helped My Business Grow (by NerdWallet) page context
How a Microloan Helped My Business Grow (by NerdWallet) is a Billshark page. It can help you with your bills and your choices, and it can show you how to save.
See how nonprofit microlenders like Accion and Opportunity Fund offer small business loans plus mentoring when banks say no.
Use this page to learn about Billshark. Then go to the part of the site that fits what you need. Small steps add up. You can save a lot over time.
We share this page to help you make sense of your monthly bills, your choices, and what to do next. Keep this page handy. Ask us if you get stuck.
This page links you to more help from Billshark. Use it when you want more detail or a clear next step. You can save a lot over time.
Got a question about a bill you pay each month? This page can help you find the best answer. Read on to learn more. Small steps add up.
Read each part of this page at your own pace. If you need more help, go on to a guide on your topic. It is free to read. Keep this page handy. Ask us if you get stuck.
We put facts and tips in one place. This makes it easy to learn about the bills you pay at home. We are here to help. It only takes a few minutes.
This page can help with real questions. You can learn about your plan, your account, and what you pay each month. Small steps add up. You can save a lot over time.
Use the menu and the links to go from a big question to the facts that fit your own needs. Keep this page handy. Ask us if you get stuck.
We keep things short and clear so you can choose well. You can then read more if you want to. It only takes a few minutes. You are in the right place.
The links on this page help you weigh your choices. They also help you see what you pay and what to do next. You can save a lot over time.
Our goal is to help you spot the bills you pay each month. We also share smart ways to keep them low. Ask us if you get stuck. Read on to learn more.
Come back to this page when you have a new question. It will still be here to help with bills and savings. You are in the right place. It is free to read.
We link the small choices you make each day to the big picture. That means your budget and what you spend at home. We make it easy for you.
Each part of this page helps you see what you need. It may be help with a plan, your account, or a good read. Read on to learn more. Small steps add up.
Use what you learn here to plan your questions. Look at your choices, then take the next step when you are ready. It is free to read. Keep this page handy.
Our pages link to each other. That way, you can find more help and still keep track of what you came for. We are here to help. It only takes a few minutes.
This page makes it easy to find the key facts first. Then you can pick a plan or make a change with less stress. Small steps add up. You can save a lot over time.
Good facts help you see why a bill went up. They also show you what to check before you call or reply. Keep this page handy. Ask us if you get stuck.
This page puts the key facts in one place. It can help you talk with a company about your bills and how to save. It only takes a few minutes. You are in the right place.
Our other pages explain the words you see on a bill. They also help you weigh the pros and cons of each plan. You can save a lot over time. We make it easy for you.
Our tips focus on real choices you can make. Start with the basics, then read a more detailed guide if you need one. Ask us if you get stuck. Read on to learn more.
This page is one of many that we share. Together they cover home costs, the firms you pay, and how to get help. You are in the right place. It is free to read.
Take your time and read this page first. It helps you see your choices and find out what to read next. We make it easy for you. We are here to help. It only takes a few minutes.
We set this page up so you can compare and keep reading. You will not need to hunt for what you want. Read on to learn more. Small steps add up. You can save a lot over time.
Monthly bills come with rules, terms, and fine print. This page helps you find the parts that count for you. It is free to read. Keep this page handy. Ask us if you get stuck.
Our pages give you a clear view of what you pay each month. You can then pick the plan or guide you want. We are here to help. It only takes a few minutes.
Some of our guides cover the basics. Others go into detail on one company or one type of bill. Small steps add up. You can save a lot over time. We make it easy for you.
It pays to read first and act later. This page links you to the next guide if you want to learn more. Keep this page handy. Ask us if you get stuck.
We share guides that help you make sense of your bills. They show your choices and the best next step. It only takes a few minutes. You are in the right place.
Want more detail on a bill, a plan, or your account? Check this page against the links we share here. You can save a lot over time. We make it easy for you.
We group our pages by topic to keep things simple. This helps you stay on track as you read about your costs. Ask us if you get stuck. Read on to learn more.
A bit of background goes a long way. It helps you spot what counts before you check a bill, change a plan, or call us. You are in the right place. It is free to read.
This page is part of our help library. It gives you clear facts and links so you can keep on reading. We make it easy for you. We are here to help.
Your needs can change, so come back any time. Our other pages can help you look into a new cost or plan. Read on to learn more. Small steps add up. You can save a lot over time.
We laid out this page to help you get the facts and compare them. You can then choose your next step with ease. It is free to read. Keep this page handy.
When a bank says no, a nonprofit microlender can say yes.
Before a chance meeting in 2013 with Accion, a nonprofit microlender, Kris Schoenberger pulled in $20,000 to $30,000 annually through his mobile catering company, BBQ’d Productions.
A little more than a year later, Schoenberger’s business in Third Lake, Illinois, north of Chicago, had grown to include a full-service restaurant.
Schoenberger gives a lot of the credit to Accion.
“Not only do they give you the money,” Schoenberger says, “they also teach you how to make the most out of that money.
This type of financial and business education is central to the mission of most nonprofit microlenders .
Nonprofit microfinance organizations also help people in underprivileged and underrepresented communities access the capital they need to start businesses, buy homes or build credit, often when they can’t get financing through a traditional bank.
In recent years, microlenders have become more visible as traditional lenders, such as banks, pulled back on small-business lending during and after the recession.
Microlending has been growing in the U.S., according to the latest information from the Aspen Institute, whose FIELD program collects data on microlenders across the country.
Germaine Seufert took out an $18,000 loan from Accion , after being declined by a bank, to buy a bus to help expand her organization’s summer camp.
Before approving the loan, Accion made a site visit, called business references and looked over the organization’s books.
When she went to Accion to refinance the loan to buy a second bus, the process went much more quickly.
Founded in 1961, the global nonprofit Accion helps millions of people in more than 20 countries secure financing.
