The Small Business Administration has approved the Oregon Association of Minority Entrepreneurs (OAME) as a micro lender for Oregon and Southwest Washington businesses, to the tune of $1.1 million and possibly as much as $3.5 million.
Part of President Barack Obama's stimulus package, the 10-year, interest-free loan is designed to help small businesses in need of capital and laid-off workers who are starting their own businesses.
"This is the only program of its kind that gets down to the people that traditionally don't qualify for what I would call traditional bank loans – your startups, your small home-based businesses, your businesses that maybe don't yet have the good track record that the banks would traditionally want to see," said SBA District Director Harry De Wolfe.
"We have to sign some final documents with the details but it should be available within 30 days," he said. "I already have the paperwork in front of me, it's already been approved."
De Wolfe says such loans are traditionally hard for small businesses to get because banks spend just as much money and time to process a $5,000 loan as a $50,000 loan – but they make less profit on them.
He said the program includes education and development training for borrowers before the loans from OAME are awarded.
OAME has already served as a federally-funded micro-lender since 2002. De Wolfe says the importance of this new loan is that it raises their lending limit from $150,000 total to $1.1 million.
"It's not a grant – the SBA's not giving the money to them, it's a 10-year no-interest loan to OAME," De Wolfe says.
He added that OAME is eligible to bump that million-dollar loan limit up to $3.5 million.
"It's all based on their performance and their ability to select good candidates to receive the loans," De Wolfe said.
Loan amounts will range from $500 up to $35,000. The OAME loan committee will review applications, terms and conditions of the loans. The organization also provides technical assistance to borrowers to assure the growth and development of their businesses.
OAME was a winner of the 2000 Vision Award for Excellence given by the U.S. Small Business Administration.
For more information contact 503-249-7744 or go to www.oame.org