Rural Small Business and Entrepreneurship Loan Fund
Rural Small Business and Entrepreneurship Loan Fund helps small businesses, specifically micro-businesses or micro-enterprises grow and maintain their businesses. What is a micro-enterprise? Good question! It is a business with five (5) or fewer employees including the owners. We have made these loans to these entrepreneurs and small businesses throughout rural Tennessee. We provide an alternative source of capital to small business owners who can't get conventional bank loans and don't want to use credit cards. We look at more than just your credit score; and we provide one-on-one technical assistance. Rural Small Business and Entrepreneurship Loan Fund lends on your merit, not just on your credit.
While each business is unique, our typical clients are small businesses with more than one year in business; generate enough business income to support their expenses; have good or mixed credit; and don't qualify for a conventional bank loan. We lend to home-based businesses such as landscapers and bed and breakfasts; retail-based services such as salons, computer repair and artists; services such as web design and equine therapy; retail stores such as main street shops and markets; and light manufacturing. Part-time businesses may also apply.
Rural Small Business and Entrepreneurship Loan Fund has received funding from USDA Rural Development and the American Recovery and Reinvestment Act to help provide access to capital to small businesses.
LOAN DETAILS
- Loan Amounts
- $500-$10,000
- Loan Collateral
- $5000 or more requires collateral
- Fixed Interest Rates
- 1.25%*
- Loan Terms
- 6 months - 5 years
- Loan Fees
- 2%
- Repayment Process
- Simple and Easy
*The interest rate is 2% below prime and not to go below 1%. The interest rate is determined at the time of closing.
Eligibility Guidelines
Make sure Rural Small Business and Entrepreneurship Loan Fund is the right choice for your business and personal needs. If you do not meet our eligibility guidelines, please contact one of our business development specialists to learn about other programs in your area.
Do I qualify?
Applicants must meet the following criteria to eligible for a loan:
Existing and Start-up Business in Tennessee (including part-time and home-based businesses)
Business has five (5) or fewer employees including the owners
Located in rural Tennessee (as defined by the USDA)
To determine if your business is located in an eligible rural area, visit:
USDA Eligibility. Click "Accept" on the property eligibility disclaimer and enter your personal and business address.
Intended Use of Loans - Our loans can be used for the following:
Business expansion
Equipment and machinery
Inventory or working capital
Tenant improvements - remodeling, painting, signage, etc
Commercial business vehicle
Financially Stable
Current on all bills (personal and business)
No excessive credit card debt
Enough income to cover business and personal expenses, and afford a monthly loan payment
Good repayment history
No open/unpaid collections
No open unpaid tax liens, judgments, child support
Credit history: good, limited or none
Although applications are evaluated on a case-by-case basis the following businesses are ineligible for Rural Enterprise Loan Fund loans: Bars/Clubs, Liquor stores, Entertainment and Real Estate investment.
Preparing for a Loan?
What is the business of your business? Be able to talk about your products and services, sales and marketing and financial expectations.
Why do you need a loan? Make an itemized list of loan uses, and be able to describe how this will help you grow your business.
How is your personal financial health: Track your income and expenses.
How is your personal credit: Be honest about your payment history, and make an effort to pay back old debt.
Business and Personal Documentation
Provide a current business plan that has been reviewed and approved by an accepted business counselor. You will go over this during your consultation. Some additional information and documents may include: last available one to two year's personal and/or business tax returns, business financial statements, bank statements and other documents required by funders.
Other Considerations
If your loan is $5,000 or more then collateral will be required. If your loan is under $5,000 collateral may be required; each application is ; it is evaluated on a case-by-case basis.
Each proprietor, owner or holder of 20% or more of the business will be included on the loan.
On average, a decision will be made within three to four weeks once all documentation is received. If approved, please expect up to four to six weeks to receive the loan proceeds. While the time may be shorter, we have to give the outside estimate.
Apply for the loan
Before you apply, check our Eligibility Guidelines to make sure we're the right loan fund for you. If you do not fit our eligibility guidelines other programs may work for your needs.
Option One
Call us toll-free at 1-800-872-7201 to request an application.
Option Two
Email us at ecd.bero@tn.gov and we will follow-up with you.
[Microloan Application]
