MANCHESTER, N.H.-St. Mary's Bank has a history of great success with innovations, but a program launched this summer to provide micro loans to entrepreneurs has so far fallen flat.
St. Mary's runs a number of projects through its Community Outreach program, but its "Small Business Community Outreach Loan," which offered loans of up to $5,000 to small businesses through a partnership with abi Innovation Hub, a local not-for-profit for entrepreneurs, has not yet seen any loans approved. ("Micro-Loans Target Would-Be Entrepreneurs," July 18).
"We've had some people approach us about it, but for different reasons, we haven't closed one," said Tom Champagne, director of community outreach. "I know in talking to the lending group [at abi], it has been a catalyst to bring people in, and they have done other loans with them. It could be they needed a larger loan; $5,000 wasn't enough and they needed an SBA loan."
Despite that, Champagne said that St. Mary's plans to continue to offer the loan in 2012, with the expectation that eventually the right candidates will come along. The credit union initially budgeted a pool of $25,000 to be lent, and has budgeted the same amount for next year. No tweaks to the program are planned.
"At this point I think we want to give it more time," said Champagne. "Because these customers-new members, hopefully-have to be referred over from abi, that's kind of our way of keeping it under control. We're not talking about a huge universe of business here; we're trying to help a small universe."
Champagne said the CU has come up with any number of creative ideas over the years, some of which have worked and some of which haven't. Those that haven't, he said, are eventually scrapped.
"We're willing to be creative and try some solutions, and if they don't work, we'll try to modify them," said Champagne. "But I think as we go farther into this we're going to have some businesses take advantage of it."