A community filled with thriving micro- and small businesses fosters increased stability and investment — both capital and social — as well as upward financial mobility. Microbusinesses are critical to fostering vibrant economies. In South Carolina, 87 percent of businesses are considered microbusinesses, and yet so many have trouble accessing capital to start or expand. Many microbusinesses are founded by individuals and families with determination and drive; however, 60 percent of state households have subprime credit, which affects the ability to get a loan.
Despite the raw talent a potential business owner may have and the benefit to the community at large, there can be obstacles to starting, succeeding, and sustaining a microbusiness. Fortunately, there are community resources to help entrepreneurs contribute to the flourishing Upstate.
Access to learning and enhancing skilled trades, business skills, and soft skills are critical; however, with a large number of South Carolina residents having subprime credit — impacting their ability to receive loans — preparedness and the reality of starting or expanding a business may be challenging.
Poor or low credit can impact a variety of people for a variety of reasons. Some individuals never built credit through conservative installment loans or revolving accounts, defaulted on credit card debt, have poor debt-to-income ratio, or made poor financial decisions in the past. Also, many individuals who immigrated to the United States may not have a credit history, yielding a poor credit score. Regardless, the percentage of subprime South Carolina households could hinder microbusiness growth.
Community Development Financial Institutions (CDFIs) like CommunityWorks are local resources that provide much-needed capital and can be that bridge from ability to reality. They are committed to empowering people to become financially stable through financial education, lending, and investing.
These organizations create a safe place for people in the Upstate to access loans, build their credit and assets, and pay off high-interest debts. By focusing on financial education and providing a solution strategy, individuals and microbusiness owners are empowered to become financially stable.
CDFIs are not in competition with local banks; instead, they work in conjunction with banks, offering an alternative for individuals and families who may not be bankable at traditional financial institutions. In fact, traditional banks are typically a top referrer of customers to many CDFIs. Those customers are individuals and families, hardworking people unable to access affordable financial products and services. CDFIs can help them get back on their feet and on a path to financial stability and growth, ultimately putting more investment and tax dollars back into the community.
Through strong collaborations and partnerships, the Upstate can continue to offer robust and vibrant opportunities for financial stability and economic achievement for everyone.
Microbusiness (or microenterprise): a business with five or fewer employees, which generally needs less than $35,000 in loan capital and does not have access to the traditional banking sector.
Case study: HIT Services
Jeannette Houchens, who attended Greenville Technical College’s legal interpretation program, is one such small-business owner who was able to start her own business with the help of CommunityWorks and begin her journey toward financial independence.
Jeannette moved to the United States from Colombia in 2004, leaving behind a career in translations. When she was ready to go back to work after starting her family, Jeannette found she still had the same passion for languages and translating that she did in her home country. After noticing a lack of professional interpreters and translators, she founded HIT Services. HIT Services is a multilingual interpretation and translation company located in Greenville.
With the desire to grow her company and ensure her sacrifices and hard work would create a better life for her family, Jeannette discovered CommunityWorks through the Clemson Business Development Center. Much of her loan was used to purchase advertising materials and build her company’s website. It also helped to pay administrative expenses, such as employee salaries and insurance required for compliance.
Jeannette believes education in all forms from work and life experience to formal programs like the Greenville Chamber’s Minority Business Accelerator, in which she is currently participating, have helped to shape her as a more successful business owner and translator. She credits these programs and CommunityWorks with assisting her to think bigger and feel like she is capable of reaching higher goals.