No-interest micro loans: Philanthropist’s new tool in preventing homelessness
The new program, called the Micro Enterprise Loan Program, offers a no-interest loan to business owners to help them stay afloat during tough economic times. The loans are for up to $5,000 and approved in an on-line application with minimal paperwork.
“If you’re struggling in your business and you need some extra cash to tide you over, if you really need it, this is a no-cost loan,” said Gary Brown, founder and CEO of the Micro Enterprise Loan Program
The loans, made through the loan company MicroEnterprise.com, are intended to be used as emergency money, Brown said.
“If you’ve got a mortgage, you’re paying all the interest on that, plus your property taxes, plus those mortgage payments, plus your school tuition, plus your student loans,” he said. “If you can come up with $1,500 a month that would help the business.
“What would happen if people didn’t have those kinds of resources to come up with that?”
Brown said there is a need for emergency loans that allow someone to get a little extra cash, but it is not right for many people to take on the additional financial burden.
“That’s not what the program is about, and it’s not what I’m saying,” said Brown. “What we’re saying is if you’re in a business and need that extra money, you need it for a short period of time, you don’t have the resources to pay for that extra money for a long period of time, you might want to consider this loan program.”
Brown said the program is not intended as a way to subsidize loans to big businesses.
“We don’t want to give business loans to the major businesses that could potentially make you big bucks, and we don’t want to give business loans to the big businesses that could potentially make you a lot of money,” he said. “What we want to do is make sure that a small business or a mom-and-pop can afford to carry on and can survive during economic tough times.”
The program is set up so that anyone with a business can apply to be a loan applicant.
“There’s nothing you need to do