‘We don’t just look at the credit score.’ Loan program targets underserved entrepreneurs

Chuck Ellis was looking for old pallets in the parking lot of an Italian restaurant near Campbell Street near Columbus Park when he first came across Holy Rosary Credit Union.

It was 2013, and Ellis had recently been released from prison a year earlier. Despite the challenges, he was determined to launch his business, Incision Point Services, that manufactures and refurbishes industrial pallets.

“I had one shirt, three pairs of pants, one pair of shoes, no money, no place to live,” Ellis said. “And I walked in, and I explained my situation. And I told them I would like to open up a business account and a checking account, and then they told me what the requirements were so I set out to meet those requirements.”

Over time, Ellis’ choice to bank with Holy Rosary, a Catholic credit union, allowed him to work closely with professionals who understood his situation and helped him grow his small pallet making hustle into a thriving business.

Holy Rosary Credit Union has its own unique approach to banking and small business loans in Kansas City. The credit union’s mission is to abolish poverty by providing economic opportunity. Now thanks to a big grant from the Kauffman Foundation, the local credit union is able to support more entrepreneurs like Ellis with it’s Dream Builder’s loan program.

“It’s best to work through a credit union instead of traditional banks. It’s a lot easier for you to get a lot more personalized attention,” Ellis said.

In 2022, the credit union was given a $3.3 million grant from the foundation and another $300,000 towards technology and staff support. Holy Rosary is just one of three community development financial institutions to receive similar grants from the Kauffman Foundation, with the goal of connecting local entrepreneurs in Kansas City to the capital they need to jump start their businesses. The other two organizations that were given grants are Alt Cap and Dream Spring.

The Kauffman Foundation’s entrepreneurship program officer Shakia Webb said that although Holy Rosary Credit Union is small, it was clear it could make a huge difference.

“We knew that Holy Rosary would be the best to take on this initiative, mainly because of their mission and the type of entrepreneurs that they’re currently focusing on. [We knew] they would immediately provide that impact that we were looking for,” Webb said.

It’s among the top credit unions nationwide serving the lowest income populations, according to Holy Rosary Credit Union president Carole Wight.

“When we go to do something we don’t ask ‘do the numbers work,’ we ask if there is a need?” Wight said.

How to get a business loan

As for its small business loans, there is no minimum loan that a borrower can ask for. Credit union staff work closely with each applicant to make sure they can get a loan that makes sense for them.

The credit union’s Dream Builders’ loan program targets entrepreneurs that have run their business for at least six months and are looking for loans less than $60,000.

In order to apply for the loans, businesses will need to present three years of personal and/or business tax returns, a personal financial statement and a business statement. If an applicant doesn’t have the best credit or needs help preparing these documents, staff will work with them to finish the application.

“We don’t just look at the credit score, we look at the story behind it,” said Patricia Case, who leads commercial lending at Holy Rosary.

Ellis has applied for and received multiple loans from Holy Rosary in the 10 years that he’s been in business. In 2022, he applied for one of his largest loans yet in hopes of getting a bigger truck for his business.

In lieu of a typical credit reference, like a credit card, Ellis asked if he could use his U-haul receipts. In the previous year, Ellis spent nearly $12,000 in U-Haul rentals to maintain his business. Instead of turning him away, the credit union accepted the U-Haul receipts as a credit reference for his application.

“So they decided to help me get that truck when nobody else, no truck or car lots, would finance me or allow me to get a truck,” Ellis said.

Ellis’ business has continued to grow, too. He has four employees, and his company supplies pallets to companies across the country.

The Dream Builder program does cap loans at $60,000, however the credit union can still offer traditional loans up to $600,000. For larger businesses looking for bigger loans, the credit union can work to connect borrowers to other institutions that offer larger loans, and even if an entrepreneur seeks a loan from elsewhere, Holy Rosary staff can continue to mentor and advise along the way.

To learn more about the Dream Builder program or other loan options available, visit here to fill out a pre-application form or contact them directly via phone by calling 816-221-2734.

Holy Rosary has three locations including one at 533 Campbell St. in Kansas City, another at 401 Illinois Ave. in St. Joseph and one housed inside the Community Services League in Independence at 404 N. Noland Road.