Rural Enterprise Reporter
REAP Is Achieving Scale on a Statewide Basis
Flexible management and delivery
of quality products and services help this microbusiness support
program scale up statewide.
BY JEFF REYNOLDS, REAP PROGRAM
The Rural Enterprise Assistance Project (REAP), a program of
the Center for Rural Affairs, is one of eight microenterprise
programs chosen to participate with the Microenterprise Fund for
Innovation, Effectiveness, Learning and Dissemination (FIELD) at
the Aspen Institute. Each program implemented strategies
targeted to achieving scale.
Achieving Scale means dramatically expanding program outreach
and generating significantly higher numbers of clients over
time. Reaching people in need of microenterprise services is the
overall goal. REAP’s objective was to show that building the
scale of a successful program to serve all rural areas of a
state while securing long-term state support for this work is
This article focuses on the development and enhancement of
products and services used by REAP for reaching maximum
potential. This is one component of REAP’s strategy in achieving
scale. Please contact Jeff Reynolds at 402.656.3091 or
email@example.com to view the complete report.
Growth and Expansion
REAP’s overall growth has been steady and consistent. Since
2000, lending dollars loaned increased by 35 percent and
leverage growth by 34 percent. REAP provided services to 495
clients in Fiscal Year (FY) 2000 and 520 clients in FY 2001, an
increase of 22 percent in yearly client activity since 1999. We
expect to serve 600 clients a year by 2005. Based on REAP data
from the last four fiscal years, we found that:
- 73 percent of clients receiving loans were low-to-moderate
- A majority of clients receiving loans were women.
- REAP’s current default rate is 1.15 percent.
Meeting Challenges Head-On
Achieving scale in Nebraska on a statewide rural basis comes
with many challenges and barriers. Geography will always be a
barrier. REAP deals with this by placing staff in field-based
offices across the state. Still, as REAP increases reach in
served counties and enters those that are not yet served, the
distances spanned remain a challenge.
Scaling-up can also lead to staff barriers. We revised the REAP
delivery model to make it possible for existing staff to reach
new areas of the state and yet avoid burnout.
A third barrier is funding. As private foundations continue to
move away from funding program delivery, it must be replaced by
other sources. Public support from the state has been a key
funding source for microenterprise programs in Nebraska. Keeping
this funding stream viable will be critical for future survival.
New and Improved Services
REAP services were delivered exclusively through locally formed
peer groups from 1990 to 1999. REAP staff decided in 1999 to
expand the lending portfolio to also provide direct loans to
With a growing micro sector, peer borrower businesses often grew
beyond REAP lending limits but were not eligible for loans at
the local bank. In areas where there were no REAP associations,
individuals who could not access a loan at the bank had no
access to lending capital.
In early 2000, the REAP Direct Loan Program became a permanent
part of the lending products offered to REAP member businesses.
This new program, which now makes individual loans in the
$1,000-$25,000 range, provides loan capital for those who are
falling between the cracks where no other lending capital is
Since 1990, REAP has placed 261 peer group loans totaling
$447,973. Since 1999, REAP has placed 60 direct loans totaling
$811,898. REAP has leveraged an additional $2,257,260 in loans
from traditional sources since 1999 due to its business planning
and loan packaging services.
Individual Program Membership
In 2002, we launched the REAP Individual Program to serve
microbusiness owners who do not have access to a REAP
association. The new Individual Program is available for
graduated members from the peer program or if there is no
association available. Individual members have the option of
attending regional meetings but are not required to attend
monthly meetings of a peer group.
Moving away from the peer program has been challenging for REAP.
The ability to form and maintain peer groups in every area of
Nebraska is not possible without a huge increase in staffing.
The Individual Program gives REAP staff the ability to provide
services in areas where no peer group is available and to
clients that prefer an individual approach.
Although the peer component remains a large part of the REAP
program, difficulty in forming and maintaining groups had
increased over the years. After intensive staff planning
retreats and analysis, REAP staff felt that, with key changes,
the peer process was still a viable mechanism for reaching rural
clients in Nebraska.
The new model contains many of the features of the original, but
provides more options for group structure and flexibility in
scheduling. The model includes a “graduation” strategy, yet
clients still have access to REAP services. Under the new model,
associations will be required to meet for 24 months. Beyond this
time associations can:
- Graduate and help form a new association.
- Sign a new contract for continuation of the peer model
- Join the REAP Individual Program.
REAP now uses a “dual delivery” system with the inclusion of
an individual model. This system gives more options to clients
seeking services. Staffing questions and continued viability of
the peer component will remain the major concern with this
delivery method. REAP will closely monitor these issues, and we
will be prepared to make changes and additions as needed. This
is part of the continual evolution of REAP and is necessary to
maximize program outreach, performance, and efficiency.
The following is a list of products and services that were added
the past two years and some yet to be implemented:
- Direct loans (up to $25,000)
- Dual Delivery System (Peer & Individual)
- Loan packaging and leverage
- Health insurance program
- Website – online model (www.cfra.org/reap)
- Women’s Business Center Project
- Quick GROW loans (up to $1,000)
- Hispanic component (yet to be determined)
Since beginning in 1990, REAP has continued steady growth. REAP
has shown that it is possible to build the scale of a successful
program to serve all the rural areas of a state while securing
long-term state support. One constant with REAP is providing
quality services and products for its clients. Although the
services and products have changed and evolved, the quality
remains. Not being afraid to change and offering a program that
meets today’s ever-changing society have been key for REAP.
Contact: Jeff Reynolds,
REAP Program Director at 402.645.3296 or
firstname.lastname@example.org for more information.