It takes a lot of research to find business loans for the minority. We want to save you time, hence we have done the research for you. In this article, you will find the best small business loans for the minority. You can take your time to read through and then find the option that best suits your needs.
- SBA loans
SBA loan is a popular way of funding a small business. There are two common SBA loan options for small businesses. The SBA (7a) is the commonest option, however, it is not for only minority businesses. Minority businesses have a better chance of qualifying for an SBA loan if they apply for the SBA 8(a) Business Development Program.
- SBA Community Advantage Loans
This loan is designed to meet the needs of businesses in disadvantaged markets. SBA guarantees up to 85% of the loan amount. Businesses can access large funds when they apply for this loan option. If you are finding it difficult to qualify for traditional loans, this may be the best options.
- SBA Microloan Program
The SBA Microloan program is for minority businesses that need loan amounts less than $50,000. Although this loan option is not limited to minority businesses. They are available to small businesses who want to expand their business. This loan is offered by third-party lenders, usually, non-profit organizations.
- Accion U.S Network
This lender focuses on moderate to low-income business who do not qualify for traditional loans. This lender offers loan amounts as little as $200 and as huge as $300,000. Their services are available in all 50 states.
- Union Bank
Union Bank is another financial institution that can be considered when you are looking for business loans to minority businesses. This bank has designed a loan package that is specifically designed for the minority. They also have a business line of credit. They have a stringent lending standard for small businesses and they can grant loans up to $2.5 million.
- The National African American Small Business Loan Fund
This fund is available to minority businesses in low and middle-income communities in Chicago, Los Angeles, and New York. This fund is jointly facilitated by JP Morgan Chase and Valley Economic Development Centers.
- Business Centers for New Americans
This organization offers loans that are specifically designed for minority businesses. Loan amount ranges from $5000 to $50,000. People who qualify for this loan include refugees, immigrants, women, and other minority in the United States. People who did not qualify for traditional loans due to low credit score, small loan amount requests, and inadequate years in operation are likely to qualify for this loan.
- Online Lenders
Minority business owners can also fund their businesses using online loans. There are several online lenders that have packages to suit several minority businesses. If your business is less than 1 year and you have outstanding invoices, you can opt for invoice financing. Lenders will grant you a loan that is up to 90% of the outstanding invoice. You can pay back when your customers pay the invoice.
Kabbage is another lender that can offer you a loan if you do not qualify for traditional loans. Kabbage offers loan amounts ranging from $2,000 to $250,000. The APR also ranges from 24% to 99%, and you can repay the loan in 6 to 12 months. This lender funds your loan within a day, however, the process can also span for several days. You will need a minimum credit score of 500.
Fundbox is another lender that can help you to fund your business. They offer lines of credit ranging from $1,000 to $100,000. The APR is from 10.1% to 79.8% and the repayment term is 12 months. They can grant you loans as soon as the next business day. You will, however, need a minimum credit score of 500 to apply.
Quarterspot is also worth mentioning when we talk about lenders that offer loans to minority businesses. You can access loans from $5000 to $200,000 that APRs that range from 30% to 70%. You can repay the loan within 18 months. They are noted for funding loans in as fast as one business day.
Smartbiz is another lender that makes an important part of the list. Although they do not grant loans to people with credit scores less than 600, they offer loans at low APR. If you need a huge loan, they can help you out. They can offer loans up to $350,000 in seven days. They also have a flexible loan term. You can repay the loan within 10 years. The APR ranges from 8.53% to 9.83%.
There is also StreetShares that offers loans from $2,000 to $250,000. The APR ranges from 9% to 40% and it depends on your creditworthiness. Depending on the arrangement with the lender, you will need to repay the loan in 3 to 36 months. They will complete the process and fund the loan in 1 to 5 days.
BlueVine also offers invoice factoring to minority business owners. BlueVine buys the outstanding invoices from business owners and pays the agreed rate. You will no longer wait for your customers to pay their invoice before you get funds to run your business.
Grants for the Minority
Borrowers can also consider grants that have been reserved for minority businesses. These are some of the best grants for minority businesses.
- Community Connects Grants
The Department of Agriculture has made this grant for people who operate businesses in communities with internet speed less than 3Mbps. They will help fix the problem if you apply for this grant.
- Community Programs to Improve Minority Health Grant Program
This grant is available for minority health-related businesses. You can use this grant to spread awareness for health in minority areas.
- Partnerships for Opportunity, Workforce, and Economic Revitalization (POWER) Initiative
This grant was begun by the former president Obama to help businesses that were affected by the changing power industry. You can check out the grant blocks that have been offered by the states and local institutions. There may be one that will suit your demands.
- Water and Waste Disposal Loan and Grant Program
If you plan on investing in a waste and water business, this grant can help you out. if you are operating in a minority community, you may be eligible for this loan.
- MillerCoors Urban Entrepreneurs Series
Although this grant is not exclusive to minority business owners, there is a high chance to access this grant if you are a minority business owner. This grant focuses on diversity in entrepreneurship. They grant $150,000 to 5 selected winners. There is another award called the Consumer’s Choice Award where the winner wins $10,000.