UT Federal Credit Union's microfunding program

UT Federal Credit Union's microfunding program helping small business start-ups

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The microfunding program at UT Federal Credit Union has only been available a few weeks, but it's already getting a number of applicants. The microfunding program at UT Federal Credit Union has only been available a few weeks, but it's already getting a number of applicants.

By HAYLEY HARMON
6 News Anchor/Reporter

KNOXVILLE (WATE) - A new program at a local bank is aimed at helping entrepreneurs finally get their ideas off the ground.

It's called "microfunding," and the program's recent launch is helping small business ideas come to life.

The microfunding program at UT Federal Credit Union has only been available a few weeks, but it's already getting a number of applicants.

It's a start-up loan program for people looking to get a new venture off the ground or grow an existing one, but don't have the money to do it.

"There's plenty of people right now who are working in day jobs that have got a great idea, but they don't know where to start and they certainly don't have the $30,000 sitting in the bank to put into this idea to launch it in the first place," said Jonathan Patrick, senior vice president at UT Federal Credit Union.

A lot of big banks won't consider this type of loan because it's just to small, or they don't want to deal with the risk associated with a start-up.

That's why UT Federal Credit Union started this. They know small businesses need help, but don't have a lot of options when it comes to getting the money they need.

Those businesses include Vextras, a locally owned company that helps online retailers drive sales.

"We're sort of like the Swiss army knife of online retail," said founder and CEO Kyle Hungate.

Interested parties can just apply online for the loan, laying out their business plan in two parts.

"The third phase is a pitch, similar to "Shark Tank," in front of a committee of non-credit union advisors," said Patrick.

If approved, they not only get the loan, but get connected to resources to help them grow their business.

"For us, it's a 'get to market faster' strategy, and the money will help us get there and execute what we want to do long term," said Hungate.

This is a loan, so businesses will have to pay the money back. The length of the pay back period is extended, so they have longer to pay it back than they would with a traditional loan.

UT Federal Credit Union believes this will give them more time to focus on growing their business.


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