What is a revolving loan fund?

Revolving loan funds (RLF’s) have been used for decades to finance business development in small cities and rural areas. They are defined as a type of gap financing measure based upon a selfreplenishing pool of money. The money “replenishes” when principal payments are made, and can even grow depending on the type of interest payments utilized. These funds are administered by regional planning and development organizations, community-based nonprofits, or state or local government entities, and can be used as competitive tools to help businesses start-up or grow either in conjunction with private loans or alone