WINSTON SALEM, N.C.-Truliant FCU here has booked more than $70,000 in business loans after instituting a state-developed program to aid would-be entrepreneurs.
While the dollar amount is small, Truliant is making the loans through a program that is enhancing its profile in the community.
Thanks to a 2009 grant from the National Credit Union Foundation, in 2010 Truliant was able to begin offering classes from the R.E.A.L. (Rural Entrepreneurship Action Learning) program developed in North Carolina. Marjorie Rorie, Truliant's director of community services, explained that while the program wasn't developed specifically for CUs, it works particularly well for those the credit union serves, including low-income members from underserved rural areas.
Truliant's success with R.E.A.L. recently earned it a Best Practice Award from the CUNA Marketing & Business Development Council in the category of Community Outreach and/or Political Advocacy.
Rorie explained that the curriculum is designed for experiential learning, so that students are active participants in the learning process and receive hands-on entrepreneurship training. "We start with an activity in which they get an experience, and they're able to reflect on this exercise, and then we expand it by having them do more work in terms of research, and then they're able to apply it. So you've got very creative types of activities that relate to real-world experiences in terms of entrepreneurship."
A Dozen Underserved Markets
Truliant serves 12 different geographic areas that are considered underserved, and Rorie explained that she had noticed that some members "just weren't prepared to go in and get a business loan; they were ill equipped just to ask for it, in terms of not having a business plan or often lacking the credit score necessary to get the type of loans that they needed."
Part of the focus is on improving credit scores-and utilizing Truliant products like its NoCost Credit Review and the Share Secure Credit Builder Loan-and Truliant reports that 40 out of 48 participants in one class had scores below 600, the minimum necessary to secure a business loan.
During Truliant's first year offering R.E.A.L. courses, 126 people participated in the classes (split fairly evenly between youth and adults), and the credit union worked with a number of area groups to spread the word, including Neighbors for Better Neighborhoods and the Burlington Housing Authority. Some of the partner organizations helped recruit participants, while others also helped teach some of the courses.
Now in its second year, Rorie said the goal is to have about 75 people take part in a total of four classes spread throughout the year. So far 54 people have enrolled in three different classes in three different cities, and one more class (running between six and 12 weeks) is in the works.
Getting Folks 'Creditworthy'
Truliant won't really dig into the numbers for 2012 until this year's classes are over, but the CU tracks how many participants join and utilize services like the NoCost Credit Review, Share Secure Credit Builder loan and more. Rorie said that of the 60 adults that completed R.E.A.L. classes during 2011, six planned to start a business within the year, eight had already opened their business, and two received small business loans from the credit union for $50,000 and $16,000, respectively. One also received a $5,000 credit line.
Truliant does not offer any special rates for R.E.A.L. graduates, said Rorie. "The whole goal is to get them creditworthy and to get their business plans ready so that they can qualify."