An area nonprofit that helps small businesses get low-interest loans is calling attention to its programs after the federal government threatened to take back $272,000 that was sitting unused in the bank.
The lack of interest in the special loans perplexed the leaders of the Mid-Cumberland Area Development Corporation, who said their assistance should be more helpful than ever as normal bank loans remain elusive for many companies.
The corporation avoided losing its money by making three loans in July, then spun the experience into a reason to dedicate more energy to promoting the Revolving Loan Fund.
“Our marketing, we’re definitely going to concentrate more on that. We want to be reaching out more and going to the chambers (of commerce) and spreading the word,” said Amanda Giner, assistant director of Mid-Cumberland. “The funds are there. There’s no reason for them not to be used.”
Mid-Cumberland also expects more interest because the fund last year became available to companies in 13 counties, instead of just five “distressed” areas. The group requested an expanded coverage area after last year’s flooding, Giner said.
The Revolving Loan Fund has the simplest application and allows the most types of uses of any of three loan programs. Capital and equipment loans are available for up to $200,000. The fund currently holds $897,000.
In the past five years, Mid-Cumberland has partnered with banks to provide 22 loans worth about $2 million. Typically aiding businesses with fewer than 20 employees, the loans have gone to restaurants, auto shops and ad agencies.
Over that time, Clarksville companies took advantage most often. Eleven companies secured more than $1 million in loans, creating 48 jobs.
Less red tape
Roger Smith used a loan to buy Riverside Auto Care in Clarksville in 2006, then secured another loan after flooding last year. He said the process was easier to complete than a different variety of small business loan he also had pursued.
“I spent two or three days of paperwork ... it was a nightmare process,” Smith said of the other effort. In comparison the revolving loan fund “wasn’t a problem at all.”
Giner said the program is intentionally designed with less “red tape.
“We’re trying to help people who maybe can’t typically get a loan from a bank,” she said.
A typical loan is for seven years, with a fixed interest rate of 5 percent, although the terms are flexible, Giner said. The way the program works, part of the loan is offered by a local bank and part by Mid-Cumberland.
When companies pay interest, that money goes back into the fund, providing for future loans.
Giner said Mid-Cumberland revised its fund plan — untouched since 1986 — this summer, with a new emphasis on getting representatives in touch with more bankers, who typically refer companies to the special loans.
The lack of interest in the special loans perplexed the leaders of the Mid-Cumberland Area Development Corporation, who said their assistance should be more helpful than ever as normal bank loans remain elusive for many companies.
The corporation avoided losing its money by making three loans in July, then spun the experience into a reason to dedicate more energy to promoting the Revolving Loan Fund.
“Our marketing, we’re definitely going to concentrate more on that. We want to be reaching out more and going to the chambers (of commerce) and spreading the word,” said Amanda Giner, assistant director of Mid-Cumberland. “The funds are there. There’s no reason for them not to be used.”
Mid-Cumberland also expects more interest because the fund last year became available to companies in 13 counties, instead of just five “distressed” areas. The group requested an expanded coverage area after last year’s flooding, Giner said.
The Revolving Loan Fund has the simplest application and allows the most types of uses of any of three loan programs. Capital and equipment loans are available for up to $200,000. The fund currently holds $897,000.
In the past five years, Mid-Cumberland has partnered with banks to provide 22 loans worth about $2 million. Typically aiding businesses with fewer than 20 employees, the loans have gone to restaurants, auto shops and ad agencies.
Over that time, Clarksville companies took advantage most often. Eleven companies secured more than $1 million in loans, creating 48 jobs.
Less red tape
Roger Smith used a loan to buy Riverside Auto Care in Clarksville in 2006, then secured another loan after flooding last year. He said the process was easier to complete than a different variety of small business loan he also had pursued.
“I spent two or three days of paperwork ... it was a nightmare process,” Smith said of the other effort. In comparison the revolving loan fund “wasn’t a problem at all.”
Giner said the program is intentionally designed with less “red tape.
“We’re trying to help people who maybe can’t typically get a loan from a bank,” she said.
A typical loan is for seven years, with a fixed interest rate of 5 percent, although the terms are flexible, Giner said. The way the program works, part of the loan is offered by a local bank and part by Mid-Cumberland.
When companies pay interest, that money goes back into the fund, providing for future loans.
Giner said Mid-Cumberland revised its fund plan — untouched since 1986 — this summer, with a new emphasis on getting representatives in touch with more bankers, who typically refer companies to the special loans.
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