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FORTUNE Small Business:

How to fund a startup in Tunisia

FSB steers a North African entrepreneur toward microfinance.

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(FORTUNE Small Business) -- Dear FSB: In my country, Tunisia, you can't get a bank loan unless you already own a business based in Tunisia. Where can I find financial help to get started?

- Dhiaeddine Aweidet, Djerba, Tunisia

Dear Dhiaeddine: Banks aren't the only institutions that lend cash in Tunisia. You should consider microfinancing. It's the perfect alternative for you because lenders often don't require collateral of any type.

Microfinance generally denotes small- scale financial services provided to the poor, often through donations from lenders or from investors who rarely chip in more than a few dollars. But with enough of these donations, new businesses in poor countries can receive loans, insurance, pensions and more.

"Because of these varied needs and the fungible nature of money, microfinance services are essentially characterized by their size instead of the formality of a client's enterprise, collateral requirements...or the use of services for production or consumption," says Audrey Linthorst, a sub-Saharan Africa analyst for the Microfinance Information eXchange.

According to Linthorst, microfinance organizations often look for entrepreneurs whom the community deems "reliable." Groups tend to obtain microfinancing more readily than individuals because groups are considered safer credit risks. So you might consider finding one or more partners.

The Microfinance Information eXchange site has information about microfinance opportunities in Tunisia. Or, if you can read French or Arabic, visit Enda Inter-Arabe, an organization that provides grants and loans to businesses in Tunisia.  To top of page

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