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US: Micro-lending can do big things for small food businesses

Access to capital is a barrier many small-scale food entrepreneurs face when attempting to enter into a highly consolidated market. In many cases, new entrepreneurs do not have the necessary credit to qualify for traditional lending structures, making it nearly impossible to open new ventures.

Fortunately, organizations like the Feed the Hunger Foundation provide micro-loans to businesses that support a sustainable food economy. Feed the Hunger Foundation, based in California and Hawaii, operates as a micro-lending organization that provides financial footing for entrepreneurs who do not have access to capital, yet are poised to be successful contributors to the food system.

The Feed the Hunger Foundation uses a revolving loan fund to help farmers, value-added producers, and small businesses operate. A revolving loan fund provides lending capital, with loan repayments being paid back into the fund. As the fund replenishes, that money is used to fund another loan.

By increasing the capital circulating through their fund, Feed the Hunger can provide more micro-loans to organizations actively contributing to a sustainable food and agricultural system. For example, recent borrowers from Feed the Hunger-Hawaii include Naked Cow Dairy and Living Aquaponics.

Living Aquaponics is a family run business that manages two commercial aquaponic farms in Hawaii. In addition to offering farm tours, backyard aquaponics classes, and commercial training, Living Aquaponics also supplies local resorts with regional and fresh foods. Unable to keep pace with the growing demand from their resort clients, Living Aquaponics received a micro-loan from Feed the Hunger to open a second farm and scale up their trainings and operations.

Source: National Sustainable Agriculture Coalition
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