Rural Microentrepreneur Assistance Program - Arkansas

This program aims to support the establishment and growth of microenterprises in rural areas through financial assistance. It provides loans and grants to Microenterprise Development Organizations (MDOs) for the purposes of:

• Assisting microenterprises with startup and growth via a Rural Microloan Revolving Fund.
• Offering technical assistance and training to microloan borrowers and microentrepreneurs. MDOs applying for this program must have experience in managing a Revolving Loan Fund or have received appropriate training to manage such funds. They must also demonstrate active and successful participation in intermediary lending, such as the SBA Microloan Program.

Funding consists of:

• Grants up to $205,000 annually for technical assistance, requiring at least 15 percent matching funds.
• Loans ranging from $50,000 to $500,000 for establishing a Rural Microloan Revolving Fund, with a total aggregate debt cap of $2.5 million. The maximum loan term is 20 years with a two-year payment deferral and requires the establishment of a loan loss reserve fund. Loans to final recipients can be up to $50,000, with a fixed interest rate and limited to 75 percent of project cost.

Funds can be used for working capital, debt refinancing, purchasing equipment and supplies, and improving real estate.