Philadelphia, United States

The Philadelphia Story: Economic Integration through Integrated Services

City of Philadelphia, Department of Commerce

June 1, 2012

Access to capital and business counselling promotes entrepreneurial success and helps revitalize city neighbourhoods

Kaita Lassina dreams of new car lifts for his eight-year-old auto repair shop and expanding his business. However, without formal credit history at the bank it will be difficult to raise the money he needs.

Access to capital is a common challenge faced by immigrant entrepreneurs. While some business owners rely on informal lending circles for the financial stimulus they need, working outside the formal economy can also limit further growth.

The City of Philadelphia is working to bridge the divide between immigrant entrepreneurs and mainstream financial institutions. With a lending circle model familiar to many immigrant communities, the Rotating Savings and Credit Association (ROSCA) helps microenterprises like BB Auto Repair become credit-worthy.

Re-vitalizing Philly Neighbourhoods

Philadelphia’s future depends on immigrants. Between 2000 and 2010, Philadelphia experienced 0.6% population growth, the first increase since 1950 and directly related to immigration. In 2010, over 20 % of the population had a linguistic or ethnic minority background, up from 9% only a decade earlier. Traditional Italian and Irish sections of the city are now home to the city’s largest Vietnamese, Cambodian, Mexican, Laotian, and Indonesian communities. Nowhere is this better represented than in the world of small business. Citywide, Philadelphia’s commercial corridors display incredible diversity. Newcomers have invested in previously vacant parts of the city, bringing increased commercial activities and new entrepreneurs seeking to sustain and grow their businesses during an economic downturn.

The City of Philadelphia quickly recognized the role of immigrant entrepreneurs in revitalizing communities, providing goods and services to neighborhood residents, and developing the local economy. To help immigrant entrepreneurs navigate the system, the Department of Commerce recruited multilingual and multicultural staff and implemented language services. However, technical assistance programs and language training were not the only issues standing in the way of immigrant business success. Immigrant entrepreneurs needed access to credit to grow their businesses and confidence in the financial institutions that could help them develop sustainable investment practices.

Lending Circles

ROSCA was launched in 2010 when the city invited two of its community partners, micro-lenders FINANTA and Entrepreneur Works, to design and coordinate a lending circle program for low income business owners. ROSCA lending circles typically are made up of 14 entrepreneurs who receive a $1,400 loan and must pay back $100 per week during a 15 week period. Participants gain credit history while developing professional networks and relationships with lenders (who report back to credit bureaus). Business counseling workshops help entrepreneurs improve their business processes as well as appreciate the importance of credit and on-going investment in their businesses.


The City’s Department of Commerce offers an English for Entrepreneurs course to ROSCA graduates to help improve customer service and increase sales. Instruction for non-native speakers is offered in Mandarin, French, Korean, and Spanish by delivery partners such as the Welcoming Centre for New Pennsylvanians who can teach small business owners the nuances of American English – like not to be offended when a customer uses “Yo!” as a greeting. Topics include cross-cultural communication, as well as conflict resolution, safety and security.

Philadelphia’s combined programs to support entrepreneurs are revitalizing city neighbourhoods while making the city’s economic development efforts more inclusive and successful.

“By connecting the microloan process with credit building, this program contributes to the long-term viability of entrepreneurs, their businesses and the jobs they provide,” says Mayor Michael Nutter.

Making it Work for You:

  • Work with organizations that already have the expertise and relationships with the communities that need to be targeted.
  • Locate services within immigrant neigbhourhoods rather than City Hall
  • Providing access by language is not enough; add services that meet the needs of struggling entrepreneurs.