Revolving Loan Fund (RLF)

The Economic Development Administration’s Revolving Loan Fund Program (RLF) supplies small businesses and entrepreneurs with the gap financing needed to start or expand their business. EDA’s regional offices award competitive grants to: units of local government; state governments; institutions of higher education; public or private non-profit organizations; EDA-approved economic development district organizations; and Indian Tribes.

NWAEDD began participating in the RLF Program in the late 1970s and currently has a lending base of approximately $700,000.00. Although this is a federal program that is monitored by the EDA Regional Office in Austin, TX, NWAEDD is still responsible for loan underwriting, risk management policies, determining interest rates, securing collateral and establishing loan terms and amounts. EDA guidelines set the minimum interest rate at 4%.

In Northwest Arkansas, the Revolving Loan Fund continues to play a critical role in situations where there are limited sources of alternative financing for business start-ups and the expansion of existing businesses. The ultimate goal of the RLF program is to stimulate private sector employment, by seeking out those businesses that have the potential to create new job opportunities, but lack the capital resources to start up or expand. Loan funds play a critical role in Economic Development.  The RLF capital base is replenished by principal repayment, interest income, and fees, and is then re-loaned back into the NWA Economy.

NWAEDD also has an effective working relationship with private sector lenders who recognize the limitation of more standard financing. In certain cases private lenders and NWAEDD have elected to participate together in loans through NWAEDD’s RLF Program.

Interested applicants can contact the NWAEDD office for more information at 870-741-5404.