Revolving Loan Funding Package Micro Loan Package FAQ

The Microloan Program combines the resources and experience of the U.S. Small Business Administration with those of DEBCO a locally based non-profit organization to provide small loans and technical assistance to small businesses.

Under the Microloan Program, the SBA makes funds available to DEBCO, which act as an intermediary lender.  DEBCO uses these funds to make loans of up to $35,000 to new and existing small businesses.  DEBCO also provides management and technical assistance to help ensure success.

MicroLoan Eligibility Requirements
Virtually any type of for-profit small business:

The form of the business, whether a proprietorship, partnership or corporation, is not a determining factor.  It must, however, meet the SBA’s size standards at the time of application.  Generally, businesses applying for this type of loan will fall well within these standards.  Not-for profit childcare centers are also eligible to apply.

Use of Loan Funds
Microloan funds may be used for working capital or to purchase inventory, supplies, furniture, fixtures, machinery and equipment.  Funds may not be used to purchase real estate or to provide a down payment on real estate.

Loan Terms
The maximum Microloan is $35,000.  The average-sized loan is around $10,500.  The maximum term may vary according to the size of the loan, the planned use of funds, the requirements of DEBCO, and the needs of the borrower. 

Microloans are direct loans from DEBCO and are not guaranteed by the SBA.  Interest rates vary.

Credit Requirements
A Microloan applicant must meet the credit requirements of DEBCO.  Generally, the applicant will be expected to have good character, a strong commitment to his/her business idea, and a credit history that provides reasonable assurance that the loan will be repaid. In addition, the applicant should have some management expertise or be willing to participate in training designed to strengthen management skills.

Collateral Requirements
As with credit standards, DEBCO has collateral requirements for the Microloan Program.  In most cases, loans are at least partially collateralized by equipment, contracts, inventory or other property.  DEBCO may also require personal guaranties and personal assets.

Applying for a Microloan
The first step in applying for a Microloan is to contact DEBCO.  Since the DEBCO Microloan Program only services the counties of Clayton, Cobb, DeKalb, Fayette, Fulton, Gwinnett, Henry, Newton, and Rockdale, contact your local SBA district office or DEBCO to find out if there is a Microloan intermediary in your area.  The intermediary lender will provide information on applying for a loan and receiving technical assistance.