Osama Elkhawad | A Business Investment With Valuable Mileage

Osama Elkhawad can tell you how much every piece of machinery cost in his small auto-repair center, located across from a McDonald's and next door to a dry cleaner in Arlington.

Numbers tend to stick in Elkhawad's head: In his native Sudan, he was an accountant. But when he immigrated to the United States in 1996, he had to start over. He began working at low-paying jobs and inched his way up -- delivering pizzas, working as a cashier, managing a gas station. He eventually picked up some temporary work that used his accounting skills, but that business didn't hold up during the years of recession.

Elkhawad wanted to be an entrepreneur. Repairing cars had always been a hobby and after managing the gas station, he thought he could successfully run his own business. He found an auto-repair shop with low rent in Annandale, and used his savings and one credit card to open Barcroft Auto Center.

"Then I [was] busy learning all these thing -- mechanic classes, inspection," said Elkhawad, 41.

His main business was annual inspections. Elkhawad soon realized he could make much more if he could conduct emissions testing, since most people have both tests done together. "If I don't have the emissions machine, they will not come to me," Elkhawad said.

The emissions-testing machine he needed cost $40,000. He had to borrow the money.

It was easy for Elkhawad to calculate the potential profit from that investment, predicting a client base at least equal to the number of customers whose cars he had inspected who also needed emissions testing. Bankers didn't see it that simply.

"That time if I go to any banks, they would not give it -- because 'You don't have a credit history, you don't have a green card,' " he said.

In 2001, Elkhawad turned to the Ethiopian Community Development Council's Enterprise Development Group. EDG checked Elkhawad's credit history, which wasn't stellar. Sometimes, he says, he was so busy he forgot to make credit card payments. But EDG takes character into account, too, and noted the intensity that still drives him to work 17-hour days seven days a week. He got a $35,000 loan at 8 percent interest.

He was never late on those payments, he says. For one thing, if he hadn't paid by the 15th of every month, he would get a call from an EDG staff member around lunchtime. Elkhawad would then drive 10 minutes to EDG's welcoming Arlington office, drop his check and chat with the staff, most of whom are also immigrants.

Last year, Elkhawad found a gas station/auto center for sale and went back to EDG, hoping to finance a second location. With a new $35,000 loan, he bought the property as well as an $8,000 scanner to help diagnose car problems. EDG now has a direct link to Elkhawad's checking account that automatically deducts his monthly payment.

As his business grows, Elkhawad may be able to qualify for a bank loan at an interest rate lower than the one he pays EDG, but he says he prefers to do business with the microfinance institution.

"I had a very bad experience with a bank. Every time I tried, they said no," he says. "I said, 'I will never go to a bank for a loan or a credit card.'"

Today Elkhawad has four employees, all from Africa. In addition to English and Arabic, he's learning Spanish to better communicate with his customers, who like him, are mostly immigrants.

"If somebody come, and they don't speak English," he says, "I can help them."