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Program Information

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  • Services
  • Technical Assistance
  • Loans
  • Client Flow Chart

This Program is comprised of two assistance components: Loans and Program Services. The maximum loan amount to any one Qualifying Business is $125,000.

Acceptable purposes for loans are acquisition of machinery and equipment; working capital; supplies and materials; inventory; and other business-related activity.  A line of credit will also be considered a loan under the Program.  Lending for the acquisition of real estate will not be an acceptable purpose for a loan.  The refinancing of any existing debt will not be considered an acceptable purpose for which a loan may be made under the Program.

The Program Services are in the form of technical assistance, education and consulting services to Qualifying Businesses that may or may not be making application for loans under the Program. Program Services include, but are not limited to, financial counseling, assistance with packaging of loan proposals, developing strategies for improved cash flow management, implementing internal financial management systems, and strategic planning, conducting pertinent training workshops and seminars, certifying Qualifying Businesses and identifying procurement opportunities with State, federal, and local government systems.


Technical Assistance provided includes, but is not limited to the following: 

  • Needs Assessment
  • Entrepreneurial Counseling
  • Business Plan Development
  • Marketing and Sales Planning
  • Financial Analysis and Planning
  • Business Management
  • Financial Records/Inventory Management
  • Human Resources Policy Development

A "typical" counseling session for a start-up business starts with initial business planning basics.  The counselor discusses basic business planning including financial projections and legal entity.  The business will receive information which includes phone numbers and addresses for information about business licenses and taxes, business planning, marketing, financial, and personnel issues.

The Small and Minority-Owned Business Program defines a loan as Program Funds lent for a specific project for which the Applicant has requested Program Assistance. For a business to participate in the loan section of the Program it must meet the SMOB Program criteria, as well as, the criteria of the designated lender serving their specific region of the State.  Lender critera varies from region to region, the Small and Minority-Owned Business Program criteria for loans consideration is as follows:

Loan Criteria

1.  The following criteria shall apply when Qualified Organizations evaluate Applications for Loans:

    (a.)  Maximum Loan Amount:  One hundred twenty-five thousand dollars ($125,000).

    (b.)  Loan Interest Rate: May be a fixed rate or variable rate, provide the variable rate does not exceed the maximum rate.

    (c.)  Maximum Loan Interest Rate:  2% over the  "Prime Rate" as published in the Wall Street Journal.

    (d.)  Minimum Loan Interest Rate: 2% under the “Prime Rate” as published in the Wall Street Journal .

    (e.)  Fees: Late charges and other fees may be imposed in accordance by Tennessee law. 

    (f.)  Term: The recommended repayment periods for loans are as followed: 

        1.  Equipment, the lesser of five (5) years or useful life;

        2.  Working capital, supplies, and inventory, three (3) years; and

        3.  Other business-related activity:  Lesser of five (5) years or useful life.

    (g). Collateral and Security:  Both business and personal collateral may be taken as security for a loan.

    (h). Guaranty Agreement:  Personal guarantees from all principal owners shall be obtained.


Please click the link to view the SMOB Client Flow Chart.

SMOB Client Flow Chart