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When You Need a Tiny Loan...

Look to microlenders for funding.

This story appears in the November 2006 issue of Entrepreneur. Subscribe »

Question: I'm starting a homebased catering business, and I only need $2,000 to buy equipment and supplies. My bank doesn't lend to startups and I don't want to charge everything on my credit card, but what choice do I have?

Answer: If you only need a small amount of money to start your business, one option to consider is to obtain a microloan. Originally intended as a way to fight poverty by lending small amounts of money to entrepreneurs in developing countries, microlending is becoming a popular source of capital for startups launched by middle-class entrepreneurs in the U.S.

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