Definition

Borrowing money from a bank or lender to fund business needs. Loans can help with startup costs or expansion plans when managed well.

What to consider

  • Check eligibility requirements thoroughly.
  • Understand all associated fees and terms.
  • Use microloans for short-term funding needs only.

Real world scenarios

  • A new business owner in rural Ohio received a small microloan from a local nonprofit to buy essential supplies.
  • An entrepreneur used a microloan to fund initial marketing for a pop-up shop.
  • A community development program provided a microloan to help launch a small bakery.

Related terms

Entrepreneurial Finances