The Microloan Program provides small, short-term loans to small business concerns and certain types of not-for-profit child-care centers. The SBA makes funds available to specially designated intermediary lenders, which are nonprofit community-based organizations with experience in lending as well as management and technical assistance. These intermediaries make loans to eligible borrowers. The maximum loan amount is $50,000, but the average microloan is about $13,000.

How MicroLoan Funds May Be Used

Microloans may be used for the following purposes:

• Working capital

• The purchase of inventory or supplies

• The purchase of furniture or fixtures

• The purchase of machinery or equipment.

Proceeds from a microloan cannot be used to pay existing debts or to purchase real estate.