Credit-led Microenterprise Lending Strategies: Survey Results

Who are Microentrepreneurs?

• 62 percent are from a minority ethnic or racial group
• 78 percent are women
• 83 percent are high school graduates
• 34 percent have employees
• 78 percent of their businesses have lasted at least 2 years

Attributes of Credit-Led (individual) Loan Programs from 328 programs surveyed by the Aspen Institute

• Average loans per program was 29
• Average loan size was $9,248
• Maximum loan size ranged from $1,000 to $500,000
• 40 percent of the programs made loans up to a maximum of $20,000
• 28 percent made loans up to a maximum of %5,000
• 36 lenders allow a maximum term of six years of longer

The Aspen Institute survey found 152 respondents who tried to get a business loan from a financial institution other than a microenterprise program. Of these:

• 47 percent received credit (71 people)
• 53 percent were denied credit (81 people)

The majority of respondents who were denied credit reported the following reasons for denial:

• business was too small or young
• lack of collateral
• inadequate or problem credit history