Minority business loan is a funding program for minority business owners to get funded and grow their small businesses. Minority business loans would possibly come from the SBA, alternative lenders, micro lenders, or non-profit companies. There are several types minority business loans. These loans normally enables small business owners who lack financial resources get access to capital. While minority business loans might seem difficult to find, there are more funding sources available to minority business owners than you might consider.
Here are five of the major funding sources for minority-owned businesses;
- The Black Business Loan Fund
As everyone know that in the US when it comes to minority, African Americans make most of the population. This also directs to the number of businesses that exist in the market. Therefore, there is necessity to create a clear way for all minority-owned businesses when it comes to starting and growing their small businesses.
- The SBA Community Advantage Loans
The Small Business Administration (SBA) also plays a major role in guaranteeing that the minority businesses can get access to capital without having a huge figure in the balance sheet. This is appropriate for small businesses due to the fact that most of them do not have a striking balance in their accounts. Furthermore, these loans do not require any collateral.
The only factor that can be an obstacle is the aspect of creditworthiness. The SBA demands that any applicant should not have bad credit. However, most of the minority businesses have good credit score and may, consequently, qualify for this loan and grow their businesses.
- Minority-Owned Business Loans
This is also another great option that any minority-owned business can apply and get a minority business loan. The loan is offered by non-bank organizations, such as Merchant Advisors, Kabbage and Balboa Capital. All of these non-bank organizations are fully dedicated to cushioning all minorities regardless of their origin or race. Minority business loans are not limited and can be used for any business purpose.
- The Business Diversity Lending Program
These loans are best to rescue all minority-owned businesses from any financial crisis. The aim of this funding program was preferably to help minority-owned businesses to qualify for funding easily with the intention to grow their small businesses. This loan is accessible via Union Bank and for one to qualify; he/she have to fall under the category of the minority under the bank’s ethnicity and race class, have business that has been active for the last two years, run as a minimum 51% of the business and borrow much less than 2.5 million USD. Which means that minorities can qualify for the business Diversity Lending Program by Union Bank.
- The National-African American Micro Business Loan Fund
Due to the fact that many African-Americans are not able to access to traditional loans due to several reasons such as low credit rankings and so on, the JPMorgan Chase came up with a concept to help African-Americans in order to offer them access to funding.
This National-African American Micro Business Loan is presently managing minorities who are currently living in New York, Chicago and Los Angeles; however soon will expand to other regions. Minorities can get $35,000 and $250,000 under these loans.
If you are a minority-owned business and could not find any financial help to grow your small business, you can get help from these resources. These resources are aimed to help minority owned businesses.