8 Best Microlenders 2020

Microloans are smaller loans, typically up to $50,000 with low minimum qualifications. Microlenders typically help newer businesses and startups get funding. The best microlenders offer low rates, generous repayment terms, and nationwide funding. We evaluated the top microlenders and selected the eight best microloans you can apply for today.

Top 8 Microlenders 2020

How We Evaluated the Best Microlenders

When evaluating the best United States microlenders, we kept entrepreneurs and small business owners in mind. The first factor we considered was accessibility. Many microlenders are local, so nationwide providers ranked at the top. We then evaluated the total cost of the microloan and the maximum loan amount. Finally, we considered requirements, terms, reviews, and the time it would take to get access to your funds.

Based on the needs of startup founders and small business owners, the criteria we used to evaluate the best microlenders include:

• Accessibility: How easily you can apply from any location in the U.S. This puts nationwide microlenders at the top of the list, followed by some local providers.
• Total cost: The overall cost of the loan for your business, which typically has starting annual percentage rates (APRs) of 8% to 13%.
• Loan amount: The maximum loan size you can qualify for, and availability of subsequent loans. Microloans rarely exceed $50,000 and most often range from $10,000 to $15,000.
• Loan terms: How long you have to repay the loan, and how frequently payments must be made. Terms can range from as little as a few months to several years, with two to three years being most common.
• Minimum qualifications: How easy the minimum requirements are to meet, including minimum credit score, annual income, and additional qualifications set by the lender.
• Time to funding: How much time is required from the time you apply until you get access to funds. You typically must wait at least 30 days for funding, but the time frame can sometimes be longer, depending on the lender and the approval process.
• User reviews: What past and current small business owners and entrepreneurs think about the microlender.

Based on these criteria, we believe Kiva offers the best overall microlender on our list. Its microloans are available online nationwide to all small businesses and have the lowest minimum qualifications, with no credit score requirement. It issues loans up to $10,000 or $25,000 in some circumstances, which is a little lower than other providers. However, most impressively, its loans don’t have an interest rate and can be repaid over three years.

Kiva: Overall Best Microloan

Kiva offers small businesses and startups interest-free microloans through crowdfunding for up to $10,000 and three years. It relies on references and support from your friends and family to establish credibility. This is the lowest cost loan, available to any business in the U.S. with an entirely online application.

Kiva Microloan Costs

Kiva offers a unique microloan to small businesses of all types because it is the only microlender that charges no interest on its loan. If you borrow $10,000, you repay $10,000―it’s that easy. This isn’t just convenient―it’s a huge boost to small businesses that have limited cash flow to make payments, allowing them to retain and reinvest all of their profits.

The costs you can expect for a Kiva microloan are:

• Interest rate: 0%
• Fees: None

With an interest rate of 0%, Kiva is the least expensive funding option on our list of the best microlenders. Although you will have to repay the principal borrowed, it’s difficult to find a more cost-effective way to fund your startup. This also means that there are many applicants for funds and that getting a campaign noticed can be difficult even compared to the top crowdfunding sites.

Kiva Microloan Terms

Kiva microloans have lower loan amounts than most of the loans we evaluated, at $10,000 compared to the typical maximum of $50,000. You will make monthly payments on the microloan, which you can calculate by dividing the loan amount by the number of payments because there is no interest to account for.

The terms of a Kiva microloan are:

• Loan amount: Typically up to $10,000; Can be as high as $25,000 for borrowers endorsed by an established Kiva Trustee
• Loan terms: Up to 36 months
• Speed to funding: The funding process can take as long as 60 days, with the initial round of private backers taking up to 30 days, and a public campaign of 30 days

Your loan can last up to three years, which is shorter than U.S. Small Business Administration (SBA) microloans, which can last up to six years. It also takes about 60 days in total to get funded, which is like the SBA options from microlenders like Accion.

Kiva Microloan Qualifications

Qualifying for a Kiva loan doesn’t require a minimum credit score or time in business. This makes Kiva loans the easiest to qualify for on our list. Instead of a credit score, Kiva relies on social underwriting to determine creditworthiness through a private fundraising round. In this round, you’ll be asked to invite friends and family to back your microloan with small contributions.

The minimum qualifications you will have to meet for a Kiva loan are:

• Credit score: No minimum
• Social underwriting: Must have 10 to 35 friends and family contribute to the loan
• Loan purpose: Must be for business purposes only
• Borrower qualification: Must be at least 18 years old and living in the U.S.
• Personal guarantee: None
• Collateral: None

The process to get funded requires a social underwriting stage. In this stage, your fundraising campaign is invite-only, and you need to have 10 to 35 supporters contribute in increments of at least $25. Kiva uses this to get campaigns off the ground before they go public. Once the social underwriting stage is completed, the campaign goes live for the public to contribute.

What Kiva Microloans Are Missing

Kiva has a maximum funding amount of $10,000 and requires the social underwriting of supporters to approve the campaign. However, there is no interest. For larger loans up to $50,000 and no social underwriting, you should consider working with Accion, which offers SBA microloans with a more traditional application process.

What Users Think About Kiva Microloans

Kiva reviews from around the web are very positive. Users that gave Kiva positive ratings noted how an interest-free loan helped their business get off the ground. Some users that gave Kiva negative reviews could not get their startups fully funded in the allotted time period.

How to Apply for a Kiva Microloan 

To apply for an interest-free Kiva microloan for up to $10,000 you need to complete a 30-minute application. One of its representatives will be in touch to complete the details. Then you’ll have 15 days to invite friends and family to get funding, and if you’re successful your campaign will go public for 30 days and funding will be transferred at the end to your PayPal account.

Visit Kiva

Accion: Best Microlender for SBA Microloans Nationwide

Accion is the only national not-for-profit community microlender offering microloans in every state, without a specific focus on a type of borrower or business. It’s a preferred SBA lender and offers microloans up to $50,000 with starting rates of 8%. You can take up to five years to repay the loan with monthly payments and funding takes 30 to 90 days.

Accion Microloan Costs

Accion microloan costs follow SBA microloan guidelines. Interest rates can range from 8% to 13% and may even be lower in some circumstances. This means that a $10,000 loan will have a daily interest cost between $2.20 and $3.60. These costs are standard for most nonprofits that provide SBA startup loans but are higher than Kiva.

The typical Accion microloan costs are:

• Interest rates: 8% to 13% for microloans
• Packaging fees: Up to 3%
• Additional fees: May include filing fees, collateral appraisal, credit report, and closing fees
• Late fees: Up to 5% of the missed payment

With Accion, you will be responsible for a packaging fee of up to 3%, which is the limit of what the SBA allows microlenders like Accion to charge for its microloans. You’ll also pay more interest compared to Kiva, which doesn’t charge any interest. However, the loan is still partially guaranteed by the SBA, so rates are lower than for most startup funding options.

Accion Microloan Terms

The terms for an Accion microloan follow the guidelines set by the SBA, except for its repayment terms which are typically one year shorter than the allowable maximum at five years. You can still get up to $50,000 in funding, with monthly payments and, from the time you apply, it will take 30 to 90 days to get funded.

The typical terms for an Accion loan are:

• Loan amount: Up to $50,000 for SBA microloans
• Repayment terms: Up to five years
• Repayment cycle: Monthly
• Time to funding: 30 to 90 days or longer

You can get up to $50,000 with Accion, which is much more than Kiva and Grameen America with longer repayment terms as well up to five years. Your time to funding may be slightly longer than with Kiva. However, among microlenders offering SBA microloans, Accion has an accessible online application, which can reduce your funding time.

Accion Microloan Qualifications

An Accion microloan requires a minimum credit score of 575 to qualify, in addition to no payments in your credit history that are past due more than 30 days. You also won’t be able to qualify if you have had a bankruptcy in the last year or your business doesn’t meet the small business size requirements set by the SBA.

The minimum qualifications for an Accion microloan are:

• Credit score: At least 575
• Collateral: Some required, typically 10% to 20% of the loan amount should be invested from personal funds as equity in the company
• Personal guarantee: Required
• Business size: You must meet the small business size requirements set by the SBA, which generally means it has $750,000 to $38.5 million or less in annual revenue and fewer than 150 employees
• Startup qualifications: Recent pay stubs, business plan, and a referral from a partner such as SCORE or the Small Business Development Center (SBDC)

Accion microloan qualifications are higher than Grameen America and Kiva. However, it has lower overall requirements than most SBA microlenders, which often require minimum personal credit scores of 640. Startups will also need to provide recent pay stubs, a business plan with 12-month projections, and a referral from an SBA partner such as SCORE or the SBDC. These partners both help startups plan for growth and navigate challenges.

What an Accion Microloan Is Missing

Accion has higher minimum qualifications for its SBA microloan and can take more than 90 days to get you funded. For lower minimum qualifications and faster funding times consider working with Grameen America or Kiva. However, both alternatives offer lower loan amounts

What Users Think About Accion Microloans

Accion reviews around the web are mixed. Users that left positive Accion reviews were happy to receive funding and noted that it was accommodating during the application process. Negative Accion reviews were unhappy with its customer service and that the loan process can take a long time.

How to Apply for an Accion Microloan

You can apply for a loan with Accion online, in under an hour. Once you complete your application, it will assign you a loan specialist that will help you assemble the necessary paperwork to qualify. You can get an SBA microloan up to $50,000 with rates starting at 8% in 30 to 90 days.

Grameen America: Best Microlender for Social Capital Microloans for Women

Grameen America is the best microlender for women needing funding with social capital approval, rather than by traditional credit standards. Social capital approval is based on the support of a peer group and can be received with almost no minimum qualifications. Loans are offered up to $15,000 at APRs starting at 6.9% to women below the poverty line in major U.S. cities in eight states and Puerto Rico.

Grameen America Microloan Costs

Grameen America microloans have their interest calculated against the outstanding loan balance, similar to a business credit card. This produces an equivalent APR of 6.9% to 7.5%, which is a daily interest cost of $1.90 to $2.05 for every $10,000 you borrow. Your payments are calculated based on the current outstanding balance, so making larger payments early can save you a significant amount of money.

The typical costs for a Grameen America loan are:

• Interest rate: 15% on a declining basis
• Expected APR: 6.9% to 7.5%
• Additional fees: None

The interest rate charged by Grameen America if lower than SBA loans offered by Accion but is more expensive than the interest-free microloans from Kiva. There are also no additional fees with Grameen American, so the total cost of your loan can be calculated with ease. Grameen America also offers classes on calculating your payments, which can be helpful if this is your first business loan.

Grameen America Microloan Terms

The first microloan is $1,500. However, Grameen America provides additional loans as businesses grow up to $15,000. The additional rounds of funding will depend on making timely payments and clear explanations for how the funds will help grow your business. Your loan will typically last six months, and you will make weekly payments when you attend training with your peer group.

The typical terms for a Grameen America microloan are:

• Loan amount: Up to $15,000 (first loan up to $1,500)
• Loan term: Typically six months, with repeat borrowers getting terms as long as one year
• Repayment schedule: Weekly

Grameen America offers the smallest starting microloan we evaluated at $1,500. You also have up to six months to repay the loan the first time you borrow, while subsequent larger loans have terms that can last up to a year. Payments are made on a weekly basis at meetings with your social group, where you will learn more about managing your finances and your business.

Grameen America Microloan Qualifications

There are no credit score requirements to qualify for a microloan with Grameen America, similar to Kiva, making credit available to the people needing it most. Grameen America targets women below the poverty line for its loans and requires that borrowers recruit three to four additional women who want to get a microloan for their business.

The typical requirements you will need to meet for a Grameen America microloan are:

• Target demographics: Women below the poverty line
• Credit score: No minimum requirement
• Social group: Find three to four peers that will also secure a microloan for their business from Grameen America

The recruiting process is the biggest hurdle for most borrowers because Grameen America does not provide any assistance assembling a group. However, networking in your community to connect with fellow aspiring entrepreneurs can help you meet like-minded people that will qualify and set your business up for success.

Where Grameen America Microloans Are Provided

Grameen America microloans must be applied for in-person at a Grameen America office. The major cities with offices are located in the states of California, Indiana, Massachusetts, Nebraska, New Jersey, New York, North Carolina, Texas, and Puerto Rico. You must commute to the local office weekly to make payments and attend meetings, so plan accordingly.

What Grameen America Is Missing

Grameen America requires that you form a group of fellow entrepreneurs that will borrow funds at the same time as you but doesn’t offer assistance in assembling this group. This can be difficult, especially if you need funding quickly. For an alternative that you can apply for on your own, consider working with Accion a nationwide SBA microloan provider.

What Users Think About Grameen America Microloans

The few reviews of Grameen America on the web are generally positive. Positive Grameen America reviews noted the opportunity that the microloans gave them to grow their business and get out of poverty. Negative reviews were rare but noted there was no assistance in locating and assembling the peer group necessary to get a loan.

How to Apply for a Grameen America Microloan

To apply for a loan with Grameen America you will need to first make sure there is an office in your city. All applications are completed in person and you need to have your peer group selected before applying. Funding typically takes a few weeks while you do training and you can get up to $1,500 for your first loan.

Visit Grameen America

LiftFund: Best Microloan for Businesses in the Southeastern U.S.

LiftFund is one of the largest nonprofit microlenders in the country, lending to businesses in the Southeastern region of the United States. It offers SBA microloans up to $50,000 at rates of 8% to 13% with terms up to six years, one year longer than Accion. It also offers SBA 7(a) loans and 504 loans, which your business can potentially qualify for.

LiftFund Microloan Costs

LiftFund offers borrowers standard SBA microloans with rates from 8% to 13% and an additional packaging fee of up to 3%. As with other SBA microlenders on our list of the best microloans, there may be additional fees required during the application process for things like collateral appraisals, filing fees, and closing fees.

The costs you can expect with a LiftFund microloan are:

• Interest rates: 8% to 13%
• Packaging fees: Up to 3%
• Additional fees: May include filing fees, collateral appraisal, credit report, and closing fees; can be added to the total loan amount
• Late fees: Up to 5% of the missed payment

Like Accion, LiftFund follows rates set by SBA guidelines for the interest and fees for its microloans. This makes it typically more expensive to borrow form LiftFund than from microlenders like Grameen America or Kiva. However, you can qualify for larger microloans with LiftFund, or other SBA loans in the future as your business grows and you need additional funding.

LiftFund Microloan Terms

LiftFund microloans go up to $50,000 like other SBA microloan providers like Accion, and its loan terms can extend up to six years. You’ll make monthly payments, which is typical for SBA microloans, but longer than the weekly payments required by Grameen America.

The typical LiftFund microloan terms are:

• Loan amount: Up to $50,000
• Repayment terms: Up to six years
• Repayment cycle: Monthly
• Time to funding: 30 to 60 days or longer

The average microloans issued by SBA microlenders are $14,000 based on data provided by the Small Business Administration. LiftFund, like Accion, is a preferred lender and has a great deal of experience with loans and the SBA, allowing it to potentially fund your loan 30 days faster than other SBA microloan options.

LiftFund Microloan Qualifications

LiftFund SBA microloans have a minimum personal credit score requirement of 575, which is the same for other SBA microlenders like Accion. You also must provide some collateral, which is typically accepted in the form of equity in the business you are building. This is required so that the SBA and the lender are confident that you are also invested in the business.

The typical LiftFund microloan qualifications are:

• Credit score: At least 575
• Collateral: Some required, typically 10% to 20% of the loan amount should be invested from personal funds as equity in the company
• Personal guarantee: Required
• Business size: You must meet the small business size requirements set by the SBA, which generally means it has $750,000 to $38.5 million or less in annual revenue and fewer than 150 employees
• Additional requirements: For microloans over $20,000 you must meet the SBA “no credit elsewhere” test, which requires that you be unable to get financing from a traditional source with comparable rates and terms

Since loans are partially guaranteed by the SBA, you will need to qualify as a small business to get funding. The SBA sets business size guidelines that are specific to the industry you are in and have revenue and employee thresholds that your business must meet. Additionally, if you can get similar funding from a traditional lender that isn’t guaranteed by the SBA, you may not qualify for a loan from LiftFund SBA.

Where LiftFund Microloans Are Provided

LiftFund operates in the Southeastern regions of the U.S. and like most SBA microlenders can only offer loans in certain states. To qualify for a LiftFund microloan, your business must be located in Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana, Mississippi, New Mexico, Montana, Oklahoma, South Carolina, Tennessee, or Texas.

What LiftFund Is Missing

LiftFund only offers microloans 13 states and relies on the SBA for approval, which can take up to 60 days or longer. You can apply for an SBA microloan nationwide with Accion as an alternative. If you need funding faster, Kiva may get you funded more quickly.

What Users Think About LiftFund Microloans

We evaluated LiftFund reviews around the web and determined that it has overall positive ratings. Positive LiftFund ratings noted how helpful their customer service was and how much the funding has helped their business grow. Negative LiftFund ratings were unhappy about not being able to qualify for a loan due to poor credit.

How to Apply for a LiftFund Microloan

Whether you need a microloan up to $50,000 or want to explore your SBA loan options LiftFund is a great option if you are located in a southeastern state. Its online application only takes a few minutes and a representative will be in touch with you in one to two business days to discuss what loans you can qualify for and how it can help your business get the funding it needs.

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USDA Farm Service Agency: Best Microlender for New & Established Farms

The United States Department of Agriculture (USDA) Farm Service Agency offers microloans up to $50,000 that are best for new and established farms because you can get capital for real estate or working capital. Loans are offered nationwide, with offices located in every state, and rates start at 1.5% to 4% with flexible payment schedules. Besides microloans, you can get other USDA loans to grow your business.

USDA Farm Service Agency Microloan Costs

Both microloans offered by the USDA have a limited interest rate of 4%, which can be even lower depending on your state office. This is the lowest interest rate on loans up to $50,000 that we evaluated and the lowest overall besides Kiva’s interest-free loan. For every $10,000 you borrow, you can expect to pay between $0.40 and $1.10 in daily interest.

The typical costs you can expect on a USDA farm ownership and operating microloan are:

• Interest rate: 1.5% to 4%
• Additional fees: None

USDA Farm Service Agency Microloan Terms

Both USDA Farm Service Agency microloans offer up to $50,000 in funding, with an option for annual payments, that corresponds with your farm income. USDA Farm Ownership microloans are intended for a down payment and improvements of farmland and buildings, so they carry longer rates up to 25 years. Operating loans, on the other hand, are intended for working capital, so the terms are shorter.

The terms you can expect for a USDA farm ownership microloan are:

• Loan amount: Up to $50,000
• Loan term: Up to 25 years; available at five-year intervals with terms of five, 10, 15, 20, or 25 years
• Repayment schedule: Annual payments; interest-only payments permitted for the first five years to correspond with income better

The terms you can expect for a USDA farm operating microloan are:

• Loan amount: Up to $50,000
• Loan term: Typically 12 months and up to seven years if it’s part of a larger financing package
• Repayment schedule: Annual payments, scheduled to correspond with income

USDA microloans have the longest repayment terms we evaluated. Having up to 25 years to repay a loan with annual payments, can make a down payment more affordable and give your farm an opportunity to thrive. Also, if you apply for a Farm Operating microloan as part of a larger financing deal, you can get terms up to seven years to match the terms of your other financing.

USDA Farm Service Agency Microloan Qualifications

Both USDA Farm Service Agency microloans don’t have a minimum credit score requirement, require that you could not qualify for traditional financing and that you own at least 50% of the farm business you are financing. The primary differences between the loans are the forms of collateral and length of management experience required to qualify.

USDA Farm Ownership Microloan Qualifications

Besides the minimum requirements that the two microloans share, you must have at least three years of farm management experience or one year of management with sufficient education to qualify. You also must be a beginning farmer, which means you’ve been operating a farm for fewer than 10 years.

The minimum qualifications you will have to meet to qualify for a USDA farm ownership microloan are:

• Credit score: No minimum score; must demonstrate acceptable credit history with on-time payments and no outstanding judgments or bankruptcies
• Management experience: Minimum of three years of farm management, or one year with sufficient education through internships, apprenticeships, or formal college education
• Insufficient access to credit: Be denied credit by traditional lenders because of income, credit score, or collateral with or without a USDA loan guarantee
• Eligibility: Be an eligible beginning farmer that has operated a farm for 10 years or socially disadvantaged farmer as outlined by the USDA
• Collateral: The real estate being purchased or improved must secure the loan with a 95% or higher loan-to-value (LTV)
• Down payment: At least 5% of the loan amount required
• Farm size: Up to 30% of the average farm acreage in the county
• Personal guarantee: Required
• Majority owner: You must own at least 50% of the farm business, 75% for business owners with less than a decade of experience

The ownership microloan is intended for land and farm improvements, so you must meet a maximum size requirement, of up to 30% of the average farm acreage in the county. Your local USDA office can help you determine if you qualify and the exact amount of collateral you must put down, which will typically be the real estate you are purchasing or improving.

USDA Farm Operating Microloan Qualifications

The USDA farm operating microloan is intended for working capital to help grow your business, release new products, or get some immediate supplies and equipment. The management experience required to qualify is minimal, requiring only sufficient education or a suitable mentor to ensure the funding is spent wisely.

The minimum qualifications you will have to meet to qualify for a USDA farm operating microloan are:

• Credit score: No minimum score; must demonstrate acceptable credit history with on-time payments and no outstanding judgments or bankruptcies
• Management experience: Minimal management requirements, included self-guided education, internships, and apprenticeships; may find and use a suitable mentor as a substitution
• Insufficient access to credit: Be denied credit by traditional lenders because of income, credit score, or collateral with or without a USDA loan guarantee
• Collateral: First lien on farm property or agricultural products of at least 100% and up to 150% of the loan amount
• Personal guarantee: Required
• Majority owner: You must own at least 50% of the farm business, 75% for less experienced owners

Besides the typical requirements, you will also need to demonstrate that you own at least 50% of the business you are attempting to finance. These terms are slightly harder to meet than other providers, with the possible exception of SBA microloans. However, the USDA Farm Service Agency is the best microlender available to farmers nationwide.

What the USDA Farm Service Agency Microloan Is Missing

The USDA Farm Service Agency microloan is only available to farmers, which restricts the type of business you can qualify with. However, it has offices in every state and, because the loan is directly from a government agency, the overall costs are low. If you need a loan that’s available nationwide, but you aren’t financing a farm, consider working with Kiva or Accion instead.

What Users Think About USDA Farm Service Agency Microloans

There are very few USDA microloan reviews on the web, but all of them were positive. These reviews noted how helpful their local USDA office was in obtaining the loan, and how useful the loan was for getting their business off the ground.

How to Apply for a USDA Farm Service Agency Microloan 

To apply for a USDA Farm Service Agency microloan, you will need to locate your state USDA office. Agency officials will help you complete the necessary forms and gather the information you need to complete the application. Typically, from the time you start, it will take 30 to 90 days to get funded.

Visit USDA Farm Service Agency

Opportunity Fund: Best Microloans for Existing Businesses in California

Microloans offered by Opportunity Fund are only available in California up to $30,000 and are easier to qualify for than SBA microloans making it a great option for California residents. You can expect rates starting at 10.9% and terms up to 36 months. There is no minimum credit score requirement, and you only need a year in business to qualify.

Opportunity Fund Microloan Costs

With Opportunity Fund, you can expect interest rates ranging from 10.9% to 18% on your microloan, which is the highest rate we reviewed. Opportunity Fund also charges an origination fee up to 5.99% for loans greater than $2,600, which gives it an overall expected APR of 15% to 22.2%.

The typical costs of an Opportunity Fund microloan (available in California only) are:

• Interest rate: 10.9% to 18%
• Expected APR: 15% to 22.2%
• Fees: $75 for loans up to $2,600; 5.99% for loans up to $30,000
• Prepayment penalty: None

The APR charged by Opportunity Fund is higher than other microlenders because it is a Community Development Financial Institution (CDFI), so there is no SBA guarantee to reduce the risk. Based on the APR disclosed by Opportunity Fund, you can expect to have a daily interest cost between $4.10 and $6.10 for every $10,000 you borrow.

Opportunity Fund Microloan Terms

Opportunity Fund microloans are available up to $30,000 with terms up to three years and monthly payments. This is a smaller microloan than most of the SBA microlenders like Accion but larger than those offered by Grameen America and Kiva. The term of 36 months is also right in the middle with SBA loans offering longer terms up to six years and other microlenders offering terms of a year or less.

The terms you can expect for an Opportunity Fund microloan (available in California only) are:

• Loan amount: Up to $30,000
• Loan term: Up to 36 months
• Repayment term: Monthly
• Speed of funding: As few as two to five days after approval

Where opportunity fund stands out is its speed to funding, which is two to five days compared to a month or longer for all the other microlenders on our list. The only reason that it isn’t the highlight for Opportunity Fund and doesn’t rank it higher on our list is that it’s only available to businesses in California.

Opportunity Fund Microloan Qualifications

Opportunity Fund does not officially state a minimum credit score. But in a conversation with the company, we could confirm that a credit score of 500 or higher is most common as long as there is on-time payment history. Opportunity Fund also makes allowances for borrowers unable to put down traditional forms of collateral and can potentially accept your personal vehicle instead.

The minimum qualifications for an Opportunity Fund microloan (available in California only) are:

• Credit score: No stated minimum, but a credit score of 500 or higher is typical
• Collateral: Vehicle may be required, in lieu of traditional collateral like equity in the business and for borrowers with low credit scores
• Personal guarantee: Required
• Time in business: At least one year, to meet the business financials and tax return application requirement
• Business location: Must be located in the state of California
• Additional requirements: On-time payment history, no liens or delinquencies

Opportunity Fund has two limiting factors that restrict access to most startups. It required at least one year in business, and that your business is located in the state of California. The time in business requirement comes from the requirement of business financial and tax returns to be submitted with the application. For businesses in the state of California that are operational and need a cash injection quickly, it’s the best microlender.

What Opportunity Fund Is Missing

Opportunity Fund requires at least one year in business to qualify for its loans because it relies on your business financials and tax returns to approve your funding. It also only provides microloans to businesses located in California. For a nationwide microlender that can get you funded without a minimum time in business up to $10,000 try Kiva, if you need up to $50,000 then Accion is the best option.

What Users Think About Opportunity Fund Microloans

We reviewed Opportunity Fund reviews on the web and determined that its ratings are generally positive. Positive Opportunity Fund reviews were happy about being able to secure funding for their business after being turned down by traditional lenders. Negative reviews noted that the company can sometimes be unresponsive and feels understaffed.

How to Apply for an Opportunity Fund Microloan 

Opportunity Fund offers microloans in California and more traditional loans up to $250,000 nationwide. If you have been in business for at least one year, and need funding you can apply online with Opportunity Fund for rates as starting at 7.9% and terms up to five years. Once approved you’ll have access to your funds in as little as two to five days.

Visit Opportunity Fund

LEAF: Another Microlender for Healthy Food Cooperatives

The Local Enterprise Assistance Fund (LEAF) provides financing through SBA microloans up to $50,000 with a focus on co-op businesses across the country. In particular, it is focused on natural food cooperatives that help provide access to healthy food in their communities and create jobs. Although it’s located in Boston, Massachusetts, you can get funding for your startup nationwide.

LEAF Microloan Costs, Terms & Qualifications

LEAF follows standard procedures for its SBA microloan providing co-op businesses focused on bringing access to healthy food to rural and urban areas. Its loans carry interest rates from 8% to 13% with limits of $50,000 and monthly repayment over six years.

The costs, terms, and qualifications you can expect for a LEAF loan are:

• Interest rates: 8% to 13%
• Packaging fees: Up to 3%
• Additional fees: May include filing fees, collateral appraisal, credit report, and closing fees
• Loan amount: Up to $50,000
• Repayment terms: Up to six years with monthly payments
• Time to funding: 30 to 90 days or longer
• Credit score: Recommended, at least 640
• Collateral: Some required, typically 10% to 20% of the loan amount should be invested from personal funds as equity in the company
• Personal guarantee: Required

Although you could potentially qualify with a lower credit score LEAF recommends that you have a credit score of at least 640, which is higher than other SBA microlenders like Accion. This is likely because the food co-op business is inherently riskier, but you can still get the same low SBA microloan rates as you would from another microlender.

What the LEAF Microloan Is Missing

LEAF microloans are available nationwide. However, your business will need to be organized as a cooperative to qualify. Accion is a great alternative with a lower minimum credit score requirement of 550 and the same SBA loan terms and rates that a business in almost any industry can qualify for.

What Users Think About LEAF Microloans

Unfortunately, there are no reviews for LEAF microloans available on the web at this time. We searched major review sites, its own page, and requested an opportunity to contact former borrowers but could not get any reviews of LEAF.

How to Apply for a LEAF Microloan 

To apply you will need to call or email the LEAF office to identify your initial eligibility for the microloan. Then you will complete your application with its assistance. In the final step, you will receive access to your microloan up to $50,000 at rates of 8% to 13% repayable over up to six years.

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Potawatomi Nation: Another Microlender for Native American Business Owners

Potawatomi Nation is a nationally recognized tribe of the Potawatomi people located in Oklahoma. It is one of three SBA microlenders operating nationwide and the only one with that reach that lends with a focus on Native Americans. Its SBA microloan is standard offering up to $50,000 in funding with terms up to six years and rates starting at 8%.

Potawatomi Nation Microloan Costs, Terms & Qualifications

Microloans offered by the Potawatomi Nation to Native American owned businesses follow the guidelines established by the SBA. Rates range from 8% to 13% for up to $50,000 repayable over six years. This puts its microloan in line with other specialized microlenders like the LEAF Fund.

The costs, terms, and qualifications you can expect from the Potawatomi Nation are:

• Interest rates: 8% to 13%
• Packaging fees: Up to 3%
• Additional fees: May include filing fees, collateral appraisal, credit report, and closing fees. Can be added to the total loan amount.
• Loan amount: Up to $50,000
• Repayment terms: Up to six years with monthly payments
• Time to funding: 30 to 90 days or more
• Credit score: Recommended, at least 640
• Collateral: Some required, typically 10% to 20% of the loan amount should be invested from personal funds as equity in the company
• Personal guarantee: Required

Besides the above qualifications, you will need to meet the SBA small business definition, which is typically less than $750,000 in annual revenue and fewer than 100 employees but may vary for your industry. These qualifications are the same as other microlenders that offer SBA microloans.

What the Potawatomi Nation Microloan Is Missing

The Potawatomi Nation requires a minimum credit score of 640 to qualify and work primarily with Native American business owners. If you need an SBA microloan with lower minimum qualifications, you could work with Accion, which only requires a minimum score of 575. Like the Potawatomi Nation, Accion lends nationwide but doesn’t have a specific demographic focus.

What Users Think About Potawatomi Nation Microloans

Unfortunately, there are no reviews for Potawatomi Nation microloans available on the web at this time. We checked major review sites and contacted the organization to provide us with references but were unable to get a review.

How to Apply for a Potawatomi Nation Microloan 

You will need to contact the Potawatomi Nation directly and request a loan application. It will work with you over the phone and email to get you funded and trained to take on the loan. The final SBA microloan can be up to $50,000 repayable over up to six years at rates from 8% to 13%.

Visit Potawatomi Nation

Microloan Alternatives

Whether you’re a startup founder seeking your first round of financing, or you have an established business needing some capital for expansion, a microloan can be a great option. However, microloans are not your only options to fund your startup, you can also leverage business credit cards for smaller purchases, a rollover for business startups (ROBS) if you have retirement savings, and personal loans to fund your business.

The best alternatives to microloans are:

• Business credit cards: Even if you already have other financing, business credit cards can be a great source of extra capital for your business. The best business credit cards can save you money with cash back and other rewards.
• ROBS: A ROBS lets you use retirement savings without incurring fees or tax penalties for startup funding. However, the process is complicated and requires you to follow the rules set by the IRS to avoid issues.
• Personal loans for business: To qualify for most business loans, you must submit a business plan and often show that you have adequate management experience. Instead, you can use a personal loan for business funding. Qualifying is based on your personal credit score, assets, and income.

Applying and receiving a microloan can sometimes take longer than most startups have to get funding. You can consider an alternative funding option such as a business credit card, personal loan, or a ROBS to get your startup enough capital to keep operating and fuel growth.

Bottom Line

There are many loan options available to small businesses. Each microloan serves a purpose and attempts to alleviate some inequality inherent in the financial system by getting businesses access to credit. There are many local nonprofits that understand their communities and national microlenders to get you funding.

The best national microloan available to borrowers is Kiva. It offers loans up to $10,000 with an online application that takes 30 minutes to complete. After a successful private and public fundraising round, you’ll get access to your funds. The best part, there are no interest payments, so you owe exactly what you borrow.

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