Fulfilling the dream of business ownership

Microenterprise Loan Program

The N.C. Microenterprise Loan Program works with individuals who have sound ideas for starting or expanding a small business but may not qualify for bank loans. On our most popular product — an express loan available in amounts up to $5,000 — you can get a loan decision within three business days. The loans are offered in combination with business planning and technical assistance. We give special emphasis to serving rural, low-income, female and minority borrowers.

Go to application and reporting forms

Frequently asked questions

Microenterprises are our smallest businesses, commonly called mom-and-pop businesses. Often, microenterprise is just one, self-employed person, and usually it will have no more than 10 employees.
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What makes this program special?
We work with people who have good ideas and sound character, but may have difficulty obtaining a loan from traditional sources. In addition, our most popular product — an express loan — can be approved within three business days. Program staff work one-on-one with potential borrowers to prepare loan applications based on the borrower's business plan, character and the local economy. Further technical assistance is offered in partnerships with Small Business Centers at area community colleges or the Small Business and Technology Development Center of the UNC system.
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You'll work with me when my bank won't?
Often, we can. We do this by working closely with you and incorporating business assistance into the loan process. Program staff work one-on-one with potential borrowers to prepare loan applications based on the borrower's business plan, character and the local economy. Further technical assistance is offered in partnerships with small business centers at area community colleges or the Small Business and Technology Development Center of the UNC system.
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Can I get free money to start my business?
We offer business loans, not grants. We charge interest and expect the loan to be paid back on time. Generally, you’ll find that grants are available only for government agencies or nonprofits, not for private, for-profit businesses.
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How much can I borrow?
That varies. The maximum available through our program is $25,000. Express loans are capped at $5,000.
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Tell me more about express loans.
Our most popular loan product, express loans may be issued for $500 to $5,000. Repayment terms range from one year to three years. Loan decisions are generally made within three business days of receiving a complete application (the same application is used for all Microenterprise loans). Although the application process is abbreviated, you will still be expected to prove credit-worthiness. Requirements increase with the size of the loan amount.
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How much interest do you charge?
The interest rate on loans is prime plus 4 percent.
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Do I have to put up collateral?
Yes. Acceptable forms of collateral include a vehicle title, equipment, inventory or a deed of trust.
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How long will I have to pay you back?
The maximum loan term is five years. Your actual term will fall between one year and five years, depending on the amount of your loan.
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Do I have to be incorporated to borrow money?
No. We fund any legal entity, and most of our borrowers are sole proprietors.
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How do I know if I qualify?
The only way to be sure is to apply. Our basic requirements are:

• You wish to start or expand a small business.
• You're located in one of the 85 rural counties of North Carolina.
• You're at least 18 years old.
• Your business has fewer than 10 full-time employees.
• You're a U.S. citizen/permanent resident and resident of North Carolina.
• Your total project cost does not exceed $50,000.
• And, of course, you have to have a sound business idea.

We'll help you take a look at it and see what the potential is. The Rural Center's Institute for Entrepreneurship Development also may be able to refer you to some useful resources.
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I've been laid off, and there aren't many good jobs in my area. Could I start my own business?
That is an option to consider. In fact, through 2011, laid-off workers in rural North Carolina have an opportunity to take advantage of a special project helping dislocated workers pursue self-employment. It’s called Project GATE, for Growing America Through Entrepreneurship, and is being offered through a federal-state partnership involving the Rural Center.
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My credit's not great because of some past mistakes, but I'm a hard worker, and I think I can make a go of this business. Can I still borrow money?
Our program is designed to help people like you — folks with good character and good business ideas, but whose credit record needs improvement.
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Will you lend me money to buy a business or a franchise?
This is an acceptable use of a micro loan, but with a qualification. Our loan cap is $25,000, and your total project can cost no more than $50,000.
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What if I can't pay you back?
When you take out a loan, you are expected to pay it back in full, with interest. The collateral you put up is security against the possibility of default. If your cash is short, we can claim the collateral property. This is an added reason for you to consider carefully before taking out a loan and to work hard to make sure your business succeeds.
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How long before I can get my money?
The approval process for an express loan ($5,000 maximum) is three business days. Other loans require about 20 to 30 days for approval. Once approved, you should receive a check in about a week.
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If I apply and you turn me down, will that show up on my credit record?
No information will show up on your credit report except an inquiry for credit.
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How do I apply?

You may apply to the Rural Center or work through one of our lending partners. Our pre-application questionnaire is a good place to start. It will help us determine whether the Microenterprise Loan Program or another business finance option might best suit your needs. If a micro loan is a good option, we'll refer you to the loan officer or group lending operator right for you. Eventually, you'll need to complete a full application. If you don't already have one, you'll also need to write a business plan. The Small Business Center Network of the N.C. Community College System offers business-planning guides for start-ups and established businesses.
Submit your questionnaires by:
E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it
Fax: 919-250-4325/Attention: Business Finance Office
Mail: Business Finance Office
N.C. Rural Economic Development Center
4021 Carya Drive, Raleigh, NC 27610
Attention: Carolyn Perry
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What if I decide I don't want the loan?
The questionnaire does not bind you or the Rural Center to a financial agreement.
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If I submit the questionnaire, who else will see it?
All information contained in the questionnaire will be kept strictly confidential and will not be used for any other purpose.
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