Mercy Corps Northwest Programs
One of our primary business development services is our loan program. We provide business loans with business mentoring to reach those who do not have access to mainstream avenues of credit and business planning services. Since inception our loan program has provided advisory assistance to over one thousand individuals and has made 230 loans totaling over $2.6 million. Loans range from $500-$50,000 and average $11,300. Over the past six years, loan losses have averaged 6%. We target clients through collaboration with economic development partners.
Our LIFE (Life-long Information for Entrepreneurs) program is a twenty-eight week training that addresses life skills, micro-enterprise development and traditional workforce preparation for incarcerated women soon to release back to open society. We operate in two facilities; Coffee Creek Correctional Facility (CCCF) in Wilsonville, OR and Washington Corrections Center for Women (WCCW) in Gig Harbor, WA. This program helps our students create productive lives after release and establish self-sufficiency and economic stability for themselves and their families. Emphasis is placed on support that begins during incarceration and continues through collaboration with social service agencies after release. Since 2007, 115 women have taken the LIFE class with a 90% completion rate.
Recent Successes and Current Challenges
For a business to benefit its owner and community, it has to do more than just start—it has to stay. Two years after receiving MCNW services, 91% of our clients remain in business, according to 2008 survey results. Of all MCNW borrowers, nearly half need a loan to launch a new business.
To prosper, a business also has to increase income over time to support the owner and hire employees. Of those in business 18 months after receiving MCNW services, median household income increases by an average of 37%. The average increase in actual household income is $6,697.
Mercy Corps Northwest benefits our local economies by increasing the household income of local entrepreneurs and their business survival rate. These stable, new businesses add new products, jobs, revenue and services to our community. On average, each MCNW small business owner creates 1.7 jobs.
An Opportunity at Hand
Microenterprises (companies with 5 or fewer employees) make up over 86% of all Oregon and Washington businesses. Most microenterprises operate as sole proprietorships, creating employment for the owner and often other family members. They are often our neighborhood “mom and pop” businesses. They face unique challenges and are denied access to conventional lending due to a lack of operating history, credit, or collateral.
Statistically over 90% of all existing US microenterprises are not well served. They lack what they need to help them thrive—funding and business expertise. This is a missed opportunity for everyone. When small businesses flourish, we all benefit.