Microloan Program

 

To assist women, low-income, and minority entrepreneurs, business owners, and other individuals possessing the capability to operate successful business concerns and to assist small business concerns in those areas suffering from a lack of credit due to economic downturns. Under the Program, the Small Business Administration (SBA) will make loans or provide guaranties to private, non-profit, and quasi-governmental organizations (intermediary lenders) that will use the loan funds to make short-term, fixed interest rate microloans in amounts up to $50,000 to start-up, newly established, and growing small business concerns. These microloans are to be used exclusively for working capital, inventory, supplies, furniture, fixtures, machinery, and/or equipment. In addition, the SBA will make grants to participating intermediary lenders to provide marketing, management, and technical assistance to prospective borrowers and borrowers receiving microloans. Under the Program, SBA will also provide training for intermediary lenders participating in the Program

General information about this opportunity
Last Known Status
Active
Program Number
59.046
Federal Agency/Office
Small Business Administration
Type(s) of Assistance Offered
A - Formula Grants; E - Direct Loans; K - Advisory Services and Counseling
Program Accomplishments
Fiscal Year 2017 No current data available
Fiscal Year 2018 No data available
Fiscal Year 2016 No current data available No data available
Authorization
Small Business Act, Section 7(m) (15 U.S.C. 636(m)), Public Law 105-135
Who is eligible to apply/benefit from this assistance?
Applicant Eligibility
An applicant is considered eligible to apply if it meets the definition of an intermediary lender as published in program materials, 13 CFR, and PL 102-140, and meets published minimum experience and capability requirements.
Beneficiary Eligibility
Small businesses, minority entrepreneurs, nonprofit entities, business owners, women and low-income, and other individuals possessing the capability to operate successful business concerns.
Credentials/Documentation
An entity may apply to SBA to become an Intermediary lender. A small business may apply to an intermediary for a microloan. Small business seeking funding must: (1) Meet SBA size standard requirements as defined in Chapter 13 of the U.S. Code of Federal Regulations; (2) meet type of business requirements as published by SBA; and (3) meet lending requirements of local intermediary lenders. This program is covered under 2 CFR 200, Subpart E - Cost Principles.
What is the process for applying and being award this assistance?
Pre-Application Procedure
Preapplication coordination is not applicable.
Application Procedure
2 CFR 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards applies to this program. Microloan Borrowers: Apply directly to intermediary lenders. Intermediary Lenders: Apply to the SBA Office of Financial Assistance, Microenterprise Development. Decision prior to deadlines and according to established procedures.
Award Procedure
Intermediaries are notified by SBA. Microborrowers are notified by the intermediaries.
Deadlines
Contact the headquarters or regional location, as appropriate for application deadlines
Approval/Disapproval Decision Time
Loan applicants can expect an answer from the SBA approved intermediary lender within 15 days from the date of application acceptance.
Appeals
Decisions on the part of the SBA are final. SBA will not become involved in appeals by microborrowers to intermediary lenders except in the case of suspected violation of Federal regulations.
Renewals
Based on performance.
How are proposals selected?
Applications are evaluated individually. Each is rated on its own merits or, in the case of an affiliated group, on the merits of each of the organizational parts that make up the whole. Qualitative and quantitative information regarding the applicant is reviewed. Criteria include but may not be limited to: (1) Experience level of Organizational Officers, Directors and personnel to be active in the Microloan Program operation; (2) Financial strength of the applicant organization; (3) Knowledge of the local economy; (4)Lending/loan performance; (5) Current and proposed technical assistance program; (6) Current and Proposed market to be served; (6) Availability and probability of matching contributions; and (7) Information submitted in the grant application package.
How may assistance be used?
Loans to intermediaries with terms and restrictions as provided in Public Laws 102-140, 102-366 and 105-135 and subsequent regulations as published in the Federal Register.
What are the requirements after being awarded this opportunity?
Reporting
Performance Reports: Information available at SBA's website at www.sba.gov.
Auditing
Required annually.
Records
Systems sufficient to generate accurate and acceptable reports.
Other Assistance Considerations
Formula and Matching Requirements
Statutory formula is not applicable to this assistance listing.

Matching is mandatory. Intermediaries must match 15% of the amount of all loans from SBA under the Microloan Program. Intermediaries must also match 25% of the amount of all grants under the Microloan Program.

MOE requirements are not applicable to this assistance listing.
Length and Time Phasing of Assistance
The maximum life of a loan to an intermediary lender is 10 years. Grants award amounts are based on the total outstanding balance of loans made to the intermediary lender by SBA and by the annual microloan production of the intermediary lender. See the following for information on how assistance is awarded/released: Additional detail available at https://www.sba.gov/sites/default/files/2018-05/Microloan%20SOP%2052%2000%20B.pdf Additional detail available at SBA's website at www.sba.gov.
Who do I contact about this opportunity?
Regional or Local Office
See Appendix IV of the Catalog of Federal Domestic Assistance under Small Business Administration.
Headquarters Office
Microenterprise Development Division - Daniel Upham
409 3rd St., SW
8th Floor
Office of Economic Opportunity
Microenterprise Development Division
Washington, DC 20416 US
daniel.upham@sba.gov
Phone: 202-205-7001
Website Address
http://www.sba.gov
Financial Information
Account Identification
73-1154-0-1-376
Obligations
(Direct Loans) FY 18$35,886,000.00; FY 19 est $42,266,000.00; FY 20 est $40,043,000.00; FY 17$44,000,000.00; FY 16$35,000,000.00; - (Advisory Services and Counseling) FY 18$22,645,538.00; FY 19 est $25,704,960.00; FY 20 est $25,000,000.00; FY 17$23,535,000.00; FY 16$24,340,000.00; -
Range and Average of Financial Assistance
No data available.
Regulations, Guidelines and Literature
Contact the SBA Office of Financial Assistance, Microenterprise Development Division, 409 3rd Street S.W., Mail Code 7881, Washington, DC 20416.
Examples of Funded Projects
Not applicable.

 


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