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Mayor Rahm Emanuel has started to set up a ‘micro-lending’ program. Emanuel is working to form the ‘Chicago Microlending Institute’ that will administer $1 million fund for distributing to micro-businesses.
This institute will be operated by ACCION Chicago that has a reputation of being an established lender. It offers $15,000 to start-ups and $25,000 to established businesses. What ACCION Chicago is going to do is it will train two lenders every year who are going to receive money from $1 million fund and then the amount shall be distributed to small businesses. In the first year of the program, ‘ACCION Chicago’ along with two micro-lenders are expecting to grant 100 small business loans.
As ‘Chicago Microlending Institute’ will be administered by ACCION Chicago, every year two additional lenders will be prepared after proper training. The training program will cost $245,000 and it will be funded by third party grants. Once the new micro-lenders graduate from ‘ACCION Chicago’, they will be receiving funds from the $1 million loan pool that will serve as seed capital to lend out to small businesses.
As small businesses are the backbone of the economy so everything needs to be done for their growth. The ‘Chicago Microlending Institute’ is one step forward in this direction. The program will help generate two top-tier micro-lenders every year in the market. The $1 million loan pool available to Chicago will enable 250 small businesses find capital and grow in business. This $1 million is just a start and eventually more funds will be made available to meet the demand of $28 million in micro-loans every year.
This article was submitted by Raj Tulshan, Director of Business Development of Biz2Credit. Biz2Credit is a small business marketplace that connects entrepreneurs with financing options and advice to grow their business. Send all questions to info@biz2credit.com
