The act consists of two programs: a loan program and a
guarantee program. 2014 Florida Senate Bill 1480 2014 Florida House
of Representatives CS/HB 7023 The Microfinance Act
Slide 3
Short-term microloans of up to $50,000 to Florida Entrepreneurs
and Small Businesses. The borrower must participate in business
training and technical assistance provided by the Florida Small
Business Development Network. The Microfinance Loan Program
Slide 4
To entrepreneurs and small businesses that employ no more than
five people and generate annual gross revenues averaging no more
than $250,000 per year for the last 2 years. 10% Set-aside
Slide 5
Loan guarantees may only be provided on loans between $50,000
and $250,000, and a guarantee cannot exceed 50 percent of the total
loan amount. Microfinance Guarantee Program
Slide 6
Eligibility is limited to borrowers who are entrepreneurs or
small businesses with 25 or fewer employees and gross annual
revenues of up to $1.5 million. Under Both Programs
Slide 7
Must be located in this state. Application fee of up to $50.
Microloans may be up to $50,000. Up to 1 year in duration. Interest
rates up to the WJS Prime rate plus 1000 basis points. A borrower
may receive a maximum of $75,000 in total microloans per year. A
maximum of two microloans per year. Five microloans in a 3-year
period. Borrower Eligibility and Conditions
Slide 8
Proceeds from a microloan can only be used for startup costs,
working capital, and to purchase materials, supplies, furniture,
fixtures, and equipment. Microfinance Loan Proceeds
Slide 9
Microloans may not be made if the microloan proceeds will be
used to: Pay off creditors Provide funds, directly or indirectly,
for payment, distribution, or as a microloan to owners, partners,
or shareholders of the business, except as ordinary compensation
for services rendered Finance the purchase, construction, or
improvement of real property held for sale or investment Pay for
lobbying activities Replenish funds used for any of the above
purposes. Not Eligible for Both Programs
Slide 10
As a condition of receiving a microloan, the borrower must
personally guarantee the microloan, participate in business
training and technical assistance, and provide information
regarding job creation and financial data to the loan
administrator. Conditions
Slide 11
They are entitled to keep 1% of the total award amount for
Administration costs. They are entitled to charge late fees. They
are entitled to charge collection fees. They are entitled to
amortize the loan for multiple years and rewrite the loan after 12
months for another 12 month term. How can the Loan Administrator
make $?
Slide 12
Businesses that have recently been turned down by a bank or
private lender. Businesses that have a great chance of getting bank
financing within 12 to 36 months. Businesses that are looking for a
short-term loan until their account receivables come in. Businesses
that are trying to establish credit. Potential Target Market
Slide 13
To help Entrepreneurs and Small Businesses in Florida that are
currently un-bankable to become bankable upon completing the loan
program. Goals and Objectives
Slide 14
Program Partners
Slide 15
Garry Thomas, Government Analyst II Florida Department of
Economic Opportunity Division of Community Development 107 East
Madison Street Caldwell Bldg., MSC 160 Tallahassee, Florida
32399-4135 Phone: 850-717-8479 [email protected]
www.floridajobs.org Q&A