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ACCION USAMicrofinance at Work in theUnitedStates<br />

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Our Mission<br />ACCION USA empowers entrepreneurs to invest in their business, family and community through financial literacy and capital.<br />

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ACCION USA History and Portfolio<br />ACCION USA offers loans from $500 to $50,000 for small business and credit development purposes at interest rates ranging from 8.99 – 15.% And Financial Education tools and resources.<br />ACCION USA has lent $122 million since 1991: With approximately 3,000 active borrowers across 46 states.<br />ACCION USA has branch locations in New York, Boston, Atlanta, and Miami and is able to serve the business coast-to-coast through our online application <br />The ACCION Network has supported over 36,000 microentrepreneurs with $250 million. This network of licensees serving TX, LA, NM, CO, AZ, IL, and CA.<br />

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Portfolio Demographics<br />65% Latino<br />20% African American<br />40% Women<br />

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Client Snapshot<br /><ul><li> 87% are low-to-moderate income

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90% are minority

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75% have lived in U.S. over 10 years

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38% are home-based businesses

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45% are first-time borrowers</li></ul>65% Latino<br />20% African American<br />40% Women<br />Source: 2009 Impact Study and ACCION USA Portfolio as of 12/31/2010<br />

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Portfolio by Industry<br />Clients work mostly in food & beverage, retail, transportation and beauty <br />

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Why are we needed?<br /> Over 850,000 microenterprises account for over 92% of privates-sector businesses in NYC, and many cannot access capital because… <br /><ul><li>Lack of credit or low credit score

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Some industries are considered to be high risk

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Lack of financial documentation or records

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Business is informal—no commercial track record

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Loan amount needed is too small

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Language Barriers</li></ul>Source: Microenterprise Employment Statistics published by the Association for Enterprise Opportunity (AEO)<br />

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The need for microfinance in the U.S.<br />40 million households (106 million people) have limited access to mainstream financial institutions in the U.S. and 28 million people are completely unbanked.<br />Microenterprises (5 employees or less) account for approximately 18% of employment in the U.S. and create 900,000 jobs a year.<br />Predatory lenders charge average annual interest rates over 300%— and accounted for over $42 billion in loan volume in 2008.<br />

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Decision Factors<br />Credit History<br />Credit Score 575 and above<br /> Relatively low balances<br /> Healthy % of available credit <br /> Open accounts that are current.<br /> Zero FICO score is acceptable for credit start loans<br />Character<br />References: residential and commercial landlords, supplier, client and/or personal references.<br />Cash Flow<br />An examination of sales versus expenses must demonstrate capacity to repay loan. Business and personal bank statement review.<br />Start-ups must present 12 months of financial projections.<br />Loan Purpose<br />Detailed list of expenditures.<br />Contributes to the positive growth of business. Loan uses that will clearly improve the revenues and/or profits of the business<br />

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Background Information Prior Learning – Loan Process<br />STEP 2:.<br />Formal Pre-Approval Process and begins Loan Application<br />STEP 1:<br />Make Connection<br />And Pre-Screen Client<br />STEP 3:<br />Client submits complete loan application. Loan Consultant interviews the client.<br />STEP 6:<br />Loan Enters Repayment<br />STEP 4:<br />Loan Application is sent to Underwriting Team<br />STEP 5:<br />Underwriter Approves Loan and Loan is Dispersed<br />

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Our Impact<br />We create sustainable businesses: The business survival rate among ACCION USA clients is 98% for established businesses and 89% for start-up businesses.<br />We create employment in low-to moderate-income communities: On average, each ACCION USA small business loan recipient creates 3 jobs (including the borrower).<br />We create fair wages: Jobs created by ACCION USA borrowers pay 33% more ($10.80/hour) than the federal minimum wage ($7.25/hour).<br />We improve their quality of life: Clients reported a 19% median increase in take-home pay in the midst of economic distress.<br />Source: 2010 MicroTest Outcomes Survey in partnership with the Aspen Institute <br />

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How to be involved?<br />Attend the Microfinance USA conference in New York City, May 23-24th 2011- Register today!<br />Tell business owners about ACCION USA- they can apply online at www.accionusa.org<br />Sign up for our news about upcoming events and important news in microfinance!<br />