Together, America Prospers

Rural Microentrepreneur Assistance

What does this 

program do? 

Provides loans and grants to 

Microenterprise Development 

Organizations (MDOs) to: 

• Provide microloans for 

microenterprise startups 

and growth through a Rural 

Microloan Revolving Fund 

• Provide training and 

technical assistance to 

microloan borrowers and 

micro entrepreneurs 

Who may apply 

for this program? 

The following are eligible to be 

an MDO:

• Nonprofits

• Federally recognized Tribes

• Institutions of higher education

The following are eligible to apply 

for a loan from the MDO as an 

ultimate recipient:

• Businesses located in an 

eligible area with 10 or fewer 

full-time employees

What is an eligible area?

• Rural areas outside a city or town 

with a population of less than 50,000. 

Urbanized areas near a city of 50,000 

or more may not be eligible

• The borrower’s headquarters may 

be based within a larger city so 

long as the project service area is 

located in an eligible rural area

• The lender may be located anywhere

Check eligible addresses 

for Business Programs

Are there other requirements?

MDOs must demonstrate experience 

in managing a Revolving Loan Fund, or:

• Certify that they or their employees 

have received education and training 

from a qualified microenterprise 

development training entity so that the 

applicant has the capacity to manage 

such a revolving loan fund; or

• Demonstrate that they are actively 

and successfully participating as 

an intermediary lender in good 

standing under the U.S. Small 

Business Administration (SBA) 

Microloan Program or other similar 

loan programs as determined by 

the Administrator

How much funding is available 

to MDOs?

• Grants are available to provide 

technical assistance to 

rural microentrepreneurs or 

microenterprises, up to 

$205,000 annually. Funding at the 

requested level is not guaranteed, 

and at least 15 percent matching 

funds are required

• Loans of $50,000 - $500,000 

may be used to establish a Rural 

Microloan Revolving Fund managed 

by the MDO. Total aggregate debt is 

capped at $2.5 million

What are the loan terms for 

the MDOs?

• Maximum term is 20 years

• 2-year payment deferral

• Must establish a loan loss reserve fund

What terms are required on loans to 

ultimate recipients?

• Up to $50,000

• Fixed interest rate

• Limited to 75 percent of project cost
Rural Microentrepreneur Assistance

How may funds be used? 

Microlenders may make microloans 

for qualified business activities and 

expenses including, but not limited to:

• Working capital

• Debt refinancing

• Purchase equipment and supplies

• Improve real estate 

How do we get started? 

Applications are accepted on an 

ongoing basis. Please reach out to 

your local state office for additional 

information and to apply. 

Who can answer questions? 

Contact your local RD office. 

What governs this program? 

• Code of Federal Regulations,

7 CFR 4280, subpart D

• This program is authorized by 

Section 379E of the Consolidated 

Farm and Rural Development Act 

(7 USC 2008s)

NOTE: Because citations and other information may be subject to change, 

please always consult the program instructions listed in the section above 

titled “What Governs This Program?” You may also contact your local office for 

assistance. You will find additional forms, resources, and program information at 

rd.usda.gov. USDA is an equal opportunity provider, employer, and lender.

Last Updated January 2020