1. Micro Enterprise Lenders Building Small Business in our Communities

2. Association for Enterprise Opportunity AEO is the national trade association for Microlenders. AEO has over 400 member organizations across the United States. Website at: www.microenterpriseworks.org

3. What is Micro Enterprise Lending? Micro enterprise lending is an income generating strategy that helps low-income people start or expand small businesses. Goals: To develop increased income and assets for Micro entrepreneurs To build local economic development by increasing job opportunities for customers

4. Characteristics of Micro Enterprises Primarily sole proprietorships Small scale loans – typically up to $35,000

5. A Typical Microlender Characteristics: Supports smaller scale loans Serves 200 people per year Makes an average of 50 loans per year Has a portfolio value between $500,000 and $600,000

6. Services provided by Micro Enterprise development organizations Training and Technical Assistance Before loan services Help the customer define and clarify: Business vision Business plan Target market Pricing strategy

7. Services provided by microenterprise development organizations Graduation and Follow-up Services Post loan services Assist entrepreneurs success: Licensing Software Applications Marketing

8. Available Capital Two Common Loan Models In-House Loans Provide loans directly to entrepreneurs Loan Pools Have special loan pools set up with banks that lend funds

9. Types of Loans Individual Loans Loans range from $500 - $35,000 Given to an individual or an individual business Peer Group Loans Loans range from $500 - $750 Short-term loans of less than one year Once loans are repaid, the borrowers can go on to borrow larger sums

10. What to look for in a Microlender Look for a Microlender that will: Understand the customer’s need for credit planning Q: What credit planning does the lender provide the customer? Provide training and follow-up services to borrowers Q: Does this Microlender help develop business plans and other skills needed for a business? Does it help assess whether self-employment is the right option for the customer?

11. What to look for in a Microlender (Continued) Look for a Microlender that will: Make good loans Q: What are the loan policies and underwriting guidelines? How are loans assessed? Do they provide credit counseling? Manage portfolios wisely Q: How is risk assessed? What is the default rate? Evaluate outcomes and successes Q: What benchmarks guide the program?

12. What AFPs and Telework loan programs bring to Microlenders The opportunity to reach people with disabilities Clients with disabilities who are well- prepared and motivated customers Credit enhancement tools, such as loan guarantees

13. Resources: Association for Economic Opportunity www.microenterpriseworks.org Abilities Fund www.abilitiesfund.org