Microlenders Widen Their Client Base

By ANJALI CORDEIRO

No loan is too small for small businesses these days.

With many banks continuing to put a hold on lending, more small-business owners and would-be entrepreneurs are turning to microlenders, organizations that dole out smaller loans typically ranging from as little as $500 to $35,000.

Microlenders, most of whom are nonprofits, have traditionally focused on helping small-business owners, particularly minorities and women, in lower-income communities as well as entrepreneurs in developing countries who need a few dollars to buy, say, a sewing machine. They tend to charge higher interest rates than banks because their borrowers are often first-time entrepreneurs or have weaker credit profiles.

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