UD Launches New Microloan Program For Minority Businesses With A Focus On Local
The loans, from $500 to $20,000, can be used for operating expenses, new equipment, hiring staff and more.
Black-owned, women-owned and other underrepresented businesses often have a tough time getting a loan. The Greater West Dayton Incubator, and the University of Dayton which oversees it, are rolling out a microloan program to give struggling businesses a hand up.
“This program has the potential to provide direct access to capital to the Greater West Dayton community through intentional outreach,” says Cherrelle Gardner, who serves on the risk review committee.
“A lot of businesses could be successful if they had even a small loan to help get them off the ground," Gardner says. "However, those channels are limited for Black and brown founders. The microloans represent the opportunity for more purposeful support in the community where entrepreneurs live and work from a program that is more invested in their success than traditional transactional lending models.”
How Much And For What Purpose?
Applications for the microloans are accepted beginning Oct. 4. Loans will range from $500 to $20,000 and can be used for operating expenses, new equipment, website development, marketing, hiring staff and other costs associated with running a business.
University of Dayton students will lend the money and manage the loan portfolio. They will also help applicants who don’t qualify apply for traditional loans from banks.
"We will be receiving the applications once they're submitted and we'll be doing an analysis process where we determine our decisions on who we think should get loans and then that will be sent over to the risk review committee to make final decisions," explains UD junior Susan Maloney.
Senior accounting major Bryan Johnson says this local program builds on an established one UD has in Nairobi, Kenya.
“Students in Flyer Consulting (a student-run, business consulting organization) are passionate about real-world impact, especially in our local community," he says.
The microloan fund is supported by an anonymous gift to the university. The Greater West Dayton Incubator is looking for more banks and foundations to grow the funding pool.