SALISBURY — Ron Fisher wants to be clear: The Carolina Small Business Development Fund is a lending resource available to all small business owners.
“I usually say we give loans to butchers, bakers, and candlestick makers,” Fisher said.
Founded in 1990, the Carolina Small Business Development Fund is a statewide financial institution dedicated to promoting economic opportunity for all through accessible lending programs. The CSBDF is one of two dozen Certified Community Development Financial Institutions in North Carolina licensed by the US Treasury.
Fisher, a loan officer at CSBDF, explained Tuesday morning at the Rowan Chamber’s Minority Affairs Board meeting how the fund can help current and future business owners in Rowan County.
“Carolina Small Business is really designed to be an entity for people who have encountered obstacles in the past trying to obtain traditional bank loans,” Fisher said.
This includes businesses owned by minorities, veterans, women, and low-income people. The CSBDF is particularly interested in helping start-up companies. These key groups have made up a significant portion of the institution’s borrowers over the past decade.
“In many cases, we are able, because we have flexible products, to find lending solutions for them that don’t quite fit the criteria that a bank may be looking for,” Fisher said.
The CSBDF offers loans up to $250,000 for all types of businesses. Loans can be used for several purposes, including working capital, purchasing inventory and supplies, acquiring a business, and purchasing real estate or furniture.
The CSBDF has “flexible” loan terms with interest rates generally between 8 and 12%. The reason the rates may be higher than those at a commercial bank, Fisher said, is that the CSBDF often borrows and lends money to larger financial institutions.
To be approved for a CSBDF loan, Fisher said a business must meet several criteria. The company must have financial capacity, guarantees and good credit. Fisher said a credit score below 650 would make it difficult for a business owner to borrow money, but not entirely impossible. He encourages business owners to review their own credit score before applying for a loan.
The CSBDF will also consider the character of a business owner and his employees. One of the most important criteria a business owner must meet is having a business that meets the right market conditions.
“It becomes a very important area to consider,” Fisher said. “If you look at what’s happening in the economy, some businesses are booming. There are others down. Market conditions may dictate that now is a good or bad time to try to secure financing right now.
The CSBDF incurs loan fees, but Fisher said the organization does not add “unwanted fees”.
“That’s another thing we do as a nonprofit lender is not try to create a lot of extra costs for our small business customers,” Fisher said. “We know they’re already looking for sources of capital that are friendly if you will.”
Business owners interested in learning more about available lending resources can contact Fisher by email at firstname.lastname@example.org.
The next Minority Business Council meeting will be Tuesday, April 19 at 9 a.m.