Opportunity Fund

Working families in Los Angeles face the challenges of managing insufficient money, finding affordable housing, raising healthy families, and preparing for the future. Nearly half of LA’s households do not earn enough to meet basic expenses. The region lacks adequate well-paying jobs in growth sectors; this lack of opportunity is compounded for low-income and minority households by the poor education system. For many households, entrepreneurship is a primary route to financial stability. Small business ownership creates opportunities for families living in poverty to pursue stability and economic mobility, while creating jobs in their communities. Research has shown that if one in three microenterprises hired an additional person, the U.S. would return to full employment; if every microbusiness generated $5,000 more annually, this would add $20B to the economy. Yet only 50% of small businesses survive, often due to an inability to access the capital they need to grow because of language and cultural barriers, limited assets, low capital needs, and poor/insufficient credit.

Opportunity Fund has a vision that every small business in Los Angeles can access the financing and support needed to realize its full potential to create wealth and jobs. As California’s largest nonprofit microlender, Opportunity Fund provides loans of $2,500 to $100,000 at affordable, fixed interest rates to small business owners with small capital needs and imperfect credit. We offer a fast, streamlined application process; flexible underwriting criteria and collateral requirements; and client-driven business advising designed to meet the needs of low-income entrepreneurs. Our relationship-based lending model removes barriers to credit that many of our borrowers face when declined by banks, including limited credit history, low net worth, inadequate time in business, lack of collateral, and small financing needs.

As part of our commitment to serving the unique needs of low-income entrepreneurs, Opportunity Fund offers EasyPay—an innovative automated loan repayment system that allows borrowers to repay loans through a small, fixed percentage of daily credit/debit card sales. Instead of making monthly payments by check, EasyPay borrowers can base their loan repayment on their actual credit/debit card revenue by “splitting” a fixed percentage of each card transaction toward loan payments. Opportunity Fund reports these repayments to the credit bureaus, so that borrowers are able to build credit over time. In practice, the automatic split means that during busy days (i.e. weekends for a restaurant), the business repays more, whereas during slow days (i.e. weekday for a clothing retailer), the business repays less. It also means that businesses with seasonal sales cycles have a repayment schedule that effectively matches their revenue cycles. EasyPay provides a convenient way to meet the capital needs of small businesses and help borrowers build credit.

Opportunity Fund’s microlending program serves entrepreneurs like David, who recently sent his fourth son to college with help from Opportunity Fund (and our EasyPay loan). David is proprietor of Mirna’s Market, a swap meet stall in South Los Angeles that features religious and party supplies targeting the city’s immigrant community. As a small business owner, David was able to keep his sons close by as they grew up—helping them do their homework in the store or teaching them to work the cash register. By providing access to affordable and convenient capital to purchase inventory and stock his shelves through EasyPay, Opportunity Fund has helped David keep his business strong and set aside savings to pay for his sons’ education.