AccionA Leader in U.S. Microfinance

Agenda

• What is U.S. microfinance?

• Who is Accion?

• Accion Products

• Strategic Partnerships

What is U.S. microfinance?

• 99% of U.S. businesses

employ fewer than 500

employees

• 91% employ

fewer than five

employees

• (microenterpris

es)

Less than 1% of the 20 million microenterprises in the United States receive credit or business assistance

Over the past 15 years, microentreprenuers have

employed 50% of all private sector employees and generated 64% of net

new jobs!

Eddie, Accion client and owner of Dardanel Mediterranean Restaurant, New York City

Microlending versus small business lending

• Little or no credit history

• Minimal financial documentation

• Small capital needs

• High risk industries

• Under two years in business

“Accion gave me the chance to start my credit history for the first time, accepting my ITIN number, and helping my business to grow.”

- Jose Araujo, Deerfield Beach, FL

Barriers to traditional capital

• We create sustainable businesses

• We create employment in low-to moderate-income communities

• We create fair wages

• We improve their quality of life

Source: 2010 MicroTest Outcomes Survey in partnership with the Aspen Institute

“Women entrepreneurs are equally strong and are able to realize what ever goal they put in their minds.”

- Lucia, Accion loan recipient and owner of La Licuadora Restaurant. Miami, FL

The impact of Accion and microfinance

Who is Accion USA?

We believe access to capital helps entrepreneurs: • Create jobs in their communities• Build assets for their families• Contribute to local economic development

19,000 loans and $121.2 MM disbursed nationwide!

Fauzia, Accion client and owner of Fauzia Heavenly Delights in Bronx, NY

Eddie, Accion client and owner of Dardanel Restaurant in Manhattan, NY

Accion: A national leader with local impact

Friends & Family Crowdfunding PersonalSavings Equity

Loan Shark Pawn Shops

Credit Cards

ACCION MICROLOANS

BankSBA Loans

An overview of the credit continuum

Equity and Investments

Jesse, recipient of the Sprout Loan at ACCION, owner of Brooklyn Taco. Manhattan, NY

Jason, Accion client and owner of a home-based soap company

*Credit cards, Microloans and Bank Loans build a credit history.

The Accion Network represents 30% of all micro-loan volume in the U.S.

Accion was established in 1991 as the domestic arm of Accion International, a global microfinance organization

The Accion Network

Professional Services (Office, Med, Education)

20%

Food & Beverage20%

Clothing, Cosmet-ics, Jewelry &

Retail17%

Transportation15%

Beauty & Salon Services

7%Construction, Repair & Elec-

tronics7%

Entertainment, Media, Telecom

& Visual Arts4%

Wholesale3%

Auto & Vehicle3%

Personal Ser-vices (Day Care,

Cleaning, Language)2%

Arts & Crafts Production

2%Manufacturing

<1%

65% Latino

40% Women

20% African American

From Top: Lyn Genet Recitas, owner of Neighborhood Holistic in Harlem, NY; Carlos Costa, owner of Costa Group Corps in Miami, FL and Cheryl Smith, owner of Cheryl’s Global Soul in NYC

Who do we lend to?

Grants:•Government•Banks•Private Foundations•Individual Donors•Volunteers

Capital:•Low-rate capital from banks•Donations from individuals,

corporations•SBA and Kiva

Revenue:•Interest and fee income•Public/private partnerships•Referral programs

Our Strong, Diverse Funding Sources

Heesang Lee, an NY based Accion client and business owner

Accion Loan Process

Step 1: APPLY Apply and quickly know eligibility through Accion’s innovative

Scorecard.

STEP 2: INTERVIEW Submit documents and get

interviewed by a loan consultant to review strengths and provide

advice

STEP 3: REVIEW Application is reviewed

considering: credit, character, collateral/cosigner, cash flow, industry, and loan purpose.

STEP 4: DECISION Loan is dispersed if approved or client

is given advice to improve.

STEP 5: RELATIONSHIP Repayment begins and clients receives ongoing business and

financial education.

Product Definition

Established Businesses(minimum 12 months)

Up to $50k

Emerging Businesses(6 months not yet profitable)

Up to $30K with outside cosigner

Sprout Loan(< 6 months)

Home-based/incubator up to $5-*10K without cosigner

Secured Loans $500 and up

Special Programs Women, Veterans, Green, Food and Beverage, Kiva

*Up to $10,000 for food & beverage businesses in certain geographies

Products and ProgramsProducts and Programs

• Credit Score over 525 (FICO)

• No more than $3,000 in past due debt*

• No Bankruptcy in the last year

• No Foreclosure in the last 2 years

• No late payments on mortgage and rent in the last year

• Start Up and Transition Requirements

• Market Study and Financial Projections for Start-Ups (Accion provides templates) Natasha, Accion client and owner of

Natasha Wozniak Jewelry. Brooklyn, NY

*Except The Sprout Loan, which cannot exceed $500

Basic Loan Requirements

• Two Forms of personal identification

• Most recent utility bill from home and business

• Past 3 months of personal & biz bank statements

• Mortgage note showing terms

• Market study/business plan and 12 months

• Financial projections (start up or sprout)

• Internal financial statements • Last two years tax returns (for loans over

$10,000)

“The biggest reward for me is seeing the enthusiasm from the benefits of my business by my clients and employees.”

–Jessie, Accion client and owner of Green City Growers Boston, MA

Required Documents

• Loan process: 5 to10 business days*

• Terms up to 60 months

• ACH Monthly Payments

• Interest rates: start at 8.99% average 11.99%

• No prepayment penalties

• Payments applied to principle and interest

*Once all documents are collected

“I’ve attended three mentoring events and am genuinely humbled by the experience, it’s validation as a small-scale entrepreneur and as a woman to be able to interact with distinguished CEOs and leaders in the fashion industry.”

–Sandra, Accion client and designer at Sandra Baquero talking about the Tory Burch Mentoring Events for Women.

Affordable Loans

• One-on-one: We provide coaching throughout the loan process on credit, cash flow and record keeping

• Online: Free webinars and a monthly newsletter help create meaningful connections with our clients

• Partnerships: We team up with other organizations to leverage resources and maximize strengths

“With Accion, it was more than just a loan. Through promotional opportunities, Accion helped to get my business name out there.”

–Kari, Accion client and owner of Morris Kitchen

More Than a Loan

• Low rate up to 8.99%

• Increased lending flexibility

• Coaching and mentorship through SCORE, Veterans across America, and SBS

Loans for Veterans (New York Only)

Our Strategic Partnerships

Nelson, Accion client and owner of Florida Atlantic Air Conditioning in Miami, FL

Bank Partnerships

•Business education

•Access to mentors and networks

• Seasonal product integration and catering

Sandy’s business helps her provide for her family. When sales went down last summer, she decided to add cold slush and drinks to her menu to boost business. Sandy’s $2,000 loan from Accion, helped her purchase equipment necessary to expand her offerings and increase sales.

Sandy, Accion client and owner of Lulu’s Sweet Shoppe in Boston, MA

Sam Adams Brewing the American Dream

• Educational events

• High profile mentors

“I have been so impressed with the mentors at the events. Every single one of them has said something memorable to me that has inspired action in my business, I can see that they really care and want to help us succeed.”

Natasha, Accion client and owner of Natasha Wozniak Jewelry. Brooklyn, NY

Tory Burch Partnership

Luis's road to self-employment was not easy. Once unemployed and homeless, Luis's life changed when he found work making deliveries for a local bakery. On the morning of September 11, he made his usual delivery to the World Trade Center when his truck got lost in the rubble of the failing buildings. Through Kiva, Accion lent Luis the money he needed to get his business back in shape.

Luis, Accion client. New York, NY

• Loans up to $10,000

• Flexible loan requirements

• Publicity for your business

Kiva.org

• Over 6,000 Twitter followers twitter.com/accion_usa

• 2,000 people “like” our Facebook page www.facebook.com/accionusa

• 30,000 subscribe to our monthly newsletters www.accionusa.org/email

• Over 40,000 visits a month to our website www.accionusa.org

• Partnership with http://dinero.univision.com/pequena-empresa

Accion’s Online Presence

• Accion can make a difference for

your clients

• Partnership and referral

opportunities

MicroloansMacro-Impact

Andy, ACCION client and owner of Cambridge Art and Frames in Cambridge, MA

A Win-Win-Win Situation

Contact Erica Dorn at 646-833-4533 and edorn@accionusa.org

Refer to online application at www.accionusa.org/apply*

Have client fax in paper application to 212-387-0277

* Promote use of your unique referral ID and Accion will track and provide feedback.To get a unique ID code, contact us!

To Refer a Business Owner