Accion Business Loans: 2023 Review
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The bottom line:
Accion Opportunity Fund loans are a good option for borrowers who've been in business for three months or more and have been turned down by other lenders.
Pros & Cons
- Loan amounts from $5,000 to $100,000.
- Businesses in operation for as little as three months may qualify.
- No minimum credit score requirements.
- Customized loan terms.
- No prepayment penalty.
- Can't be used to start a business.
- Shorter loan repayment periods of one to five years.
- Slower processing speed compared with online lenders.
- Not available in all U.S. states.
Note: Accion Opportunity Fund doesn’t require a minimum credit score for business financing and uses other factors to determine loan eligibility.
Accion Opportunity Fund, or AOF, is a nonprofit community lender offering customized loans to small-business owners throughout most of the U.S.
Over 80% of AOF borrowers identify as people of color, nearly 33% identify as female and 63% are of low-to-moderate income. In addition to small-business loans, AOF also provides educational resources and coaching support in English and Spanish.
Accion is best for borrowers who:
Have new businesses and can't get funding elsewhere. Businesses only need to be in operation for three months to apply.
Don't have perfect credit. Factors other than your credit score can be used to determine qualification.
Prefer customized options. Loan terms are structured based on your business needs.
Accion loan features
From $5,000 to $100,000.
5.99% to 16.99% for Small Business Progress loans.
12, 24, 36 or 60 months. (No penalty for repaying early.)
5-7 days for loan application to be processed.
Where Accion stands out
Flexible credit requirements
AOF says that most of its borrowers have not been able to get loans with traditional lenders because they have poor credit, no credit history or require a small loan amount. AOF can use more than a borrower's credit score to determine whether they qualify for a business loan. Annual revenue requirements vary by loan. However, borrowers will be asked to share information about their revenue and expenses.
Customized loan terms
AOF can structure a loan to meet your specific business needs. After submitting an application, you may be able to choose from several loan options with different term lengths, interest rates and monthly payment amounts. If AOF can't provide a loan, it will refer you to one of its partners or provide other financing options for you to explore.
Additional services offered
AOF does more to help small businesses than just offering loans. Free business coaching and mentoring are also available. You can set up an appointment for one-on-one assistance provided by a business expert on topics such as accessing capital, business strategies, certification programs, commercial leasing, legal support, financial management, marketing and human resources. In addition, AOF's resource center offers videos, articles and interactive learning materials.
Where Accion falls short
Funds can't be used to start a business
AOF loans are designed to support existing small-business owners, and you’ll need to be in operation for a minimum of three months to apply. This means you won't be able to use loan funds to start a business. However, most lenders won’t work with a business that’s been in operation for a short time, and AOF’s requirement of three months of operations is generous.
Loan programs aren't available in all U.S. states
AOF loans are available in most U.S. states, but you won't be eligible if your business is located in Montana, North Dakota, South Dakota, Tennessee or Vermont. Also, minimum loan amounts and business entity requirements apply in certain states.
Accion loan requirements
Credit score: No minimum required.
Time in business: Minimum of three months in business.
Annual revenue: Varies depending on the loan program.
How to apply for a loan from Accion
After completing an application online, you'll receive a quote, which AOF says won't affect your credit score. You will need to provide some basic information about your business, including revenue and expenses. Then, AOF will review loan options with you, including interest rates, repayment amounts and terms. If there are no options that work for you, AOF can refer you to other resources.
If you decide to move forward with a loan offer, you'll be asked to provide documents that AOF can use to verify the information you provided on your application. After reviewing the documentation, your loan will be finalized; you'll sign loan documents, then receive funds.
Alternatives to Accion loans
An SBA loan is another option to consider. These loans are offered through banks but partially guaranteed by the Small Business Administration. This can make them easier to qualify for because the lender takes on less risk. SBA loans also offer flexibility when a borrower has less-than-perfect credit. In addition, funds from an SBA microloan can be used to start a business, but are limited to a maximum of $50,000. AOF loans, by contrast, cannot be used to start a business; a business must be in operation for a minimum of three months to qualify for an AOF loan.
Kiva is a nonprofit that facilitates peer-to-peer microlending for small businesses. You can get up to $15,000 at 0% interest if you qualify. Kiva loans don't require a minimum credit score or collateral. Still, there are other eligibility requirements, such as the business must be based in the U.S., and you can't currently be in foreclosure, bankruptcy or under any liens. One unique Kiva provision is that borrowers are asked to demonstrate their strength of character by having friends and family make loans to them.
» MORE: NerdWallet’s top microlenders
Compare business loans
If you'd like to compare loan options, NerdWallet has a list of best small-business loans. All of our recommendations are based on the lender's market scope and track record, the needs of business owners, rates, and other factors, so that you can make the right financing decision.