Is your small business struggling to get financing that could help it grow or improve profitability? Consider a 0%-interest crowd-sourced Kiva loan. Rural Action can help.
Green Edge Gardens, whose new owners needed funding to build an indoor microgreen facility, is the latest small business to work with Rural Action on a Kiva offering. Their request for a $7,000 loan was funded quickly, with Rural Action acting as the trustee on the loan, which means we vouch for a business after reviewing the request and relevant financials. Snowville Creamery and Morning Dew Hop Farm are other local businesses that have turned to Kiva for financing.
“Kiva is an option for a business that might not be ready to go to a bank for traditional investment,” says Paul Patton, Rural Action’s Social Enterprise Director. “This program gives them the opportunity to get access to funds at 0% interest.”
In Green Edge Gardens’ case, 19 lenders committed a total of $7,000, which will be paid back over 39 months, interest-free. When lenders’ money is returned, they have the option of funding another Kiva loan or withdrawing their investment.
There are a few limitations and things for businesses to consider when financing through Kiva:
- The maximum loan amount is $15,000.
- Investors will want to see financial information and a business plan showing how the loan will increase revenue.
- Being endorsed by a trustee can be a key ingredient for success.
In the case of the Green Edge Gardens loan, Rural Action used its Sustainable Agriculture Impact Fund to provide half of the requested loan. This fund is designed to assist small agricultural and forestry businesses.
“So far we’ve had 100% repayment for loans that we’ve endorsed and put money into from our Ag Impact Fund,” Paul says. “Businesses that are interested should get in touch with us to discuss an application.”