Small Business Loans for Minorities

Small Business Loans for Minorities

If you’re a minority small business owner, you might’ve learned the hard

way that equal opportunity doesn’t always apply

to small business loans.

The Problem In a recent study coauthored by a Brigham Young University

business professor, 9 people were recruited to act as “mystery shoppers” for $60,000 small business loans.

Out of the recruits – 3 black, 3 Hispanic, and 3 white – the minority loan applicants received:

Less information Less assistance Were asked more questions about their personal finances

Given this unfortunate reality, where is the best place to seek out small business loans for minorities?

The Solution

Here is our list of the BEST 28 small business loans for minority business owners...

There are many governmental grant programs that focus on businesses owned by minorities.

8(A) BUSINESS DEVELOPMENT PROGRAMSBA 7(A) LOANS

Some 80% of SBA loan applications from black and Hispanic business owners are for $150,000 or less.

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In October 2016, SBA waived the usual 2% fee for these loans.

Loans of up to $2.5 MILLION are available.

UNION BANK provides small business loans and lines of credit specifically for minority business owners.

UNION BANK22

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THE NMSDC helps minority-owned businesses get certified as MBEs and connects them to contracting opportunities

with corporate partners.

NATIONAL MINORITY SUPPLIER DEVELOPMENT COUNCIL

This provides access to:

• Working capital loans

• Specialized financing

• Long-term financing

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55Minority small business owners seeking loans of $50,000 or

less should investigate the SBA Microloan program.

SBA MICROLOAN PROGRAM

This program encourages local mission-based lenders such as nonprofit organizations :

SBA COMMUNITY ADVANTAGE LOANS

to make loans of up to $250,000•

by guaranteeing up to 85% of the loan amount

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International microloan organization ACCION has a U.S. microlending program targeting low to moderate income business owners who

have di�iculty accessing capital through traditional channels.

ACCION U.S. NETWORK66

THE U.S. DEPARTMENT OF COMMERCE’S MINORITY BUSINESS DEVELOPMENT AGENCY

SMALL BUSINESS DEVELOPMENT CENTERS

The MBDA operates MBDA Business Centers nationwide that help minority small business

owners start and grow their companies.

Your local SBA District O�ice or Small Business Development Center (SBDC) can help you find and work with potential lenders.

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This DEPARTMENT OF THE INTERIORS grant provides funding to tribes and individual mineral owners seeking to make use of

those resources on Indian lands.

MINERALS AND MINING ON INDIAN LANDS9

COMMUNITY PROGRAMS TO IMPROVE MINORITY HEALTH GRANT PROGRAM

If you own a health-related small business, you can use this grant to spread information and awareness of minority

healthcare, and with it, your services.

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President Obama began the Partnerships for Opportunity, Workforce, and Economic Revitalization Initiative to help

communities hurt by the changing power industry.

POWER11

The RBEG program o�ers funds for rural development – including by not limited to:

RURAL BUSINESS ENTERPRISE GRANTS

RURAL BUSINESS OPPORTUNITY GRANTS

Similarly, the RBOG program gives up to $100,000 to support training for business development, in order to stimulate the

economies of rural communities.

Grants usually range between $10,000 and $50,000.

Infrastructural development

Purchasing equipment

Real estate development

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COMMUNITY CONNECT GRANTS

If you live or operate in a rural area lacking an Internet broadband speed of 3 Mbps or more, and are looking to fix

that, then check to see whether you’re eligible for this Department of Agriculture grant.

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Focusing on diversity in entrepreneurship, MILLERCOORS awards up to $150,000 to five winners, plus the

CONSUMER’S CHOICE AWARD GRANT of $10,000.

WATER & WASTE DISPOSAL LOAN & GRANT PROGRAM

This grant initiative – like many others – includes Federally-recognized tribes among its eligible applicants.

MILLERCOORS URBAN ENTREPRENEURS SERIES

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The Native Arts Capacity Building Initiative gives up to six grants of $30,000 each to Native American institutions

supporting arts and culture.

FIRST NATIONS DEVELOPMENT INSTITUTE GRANT17

TRIBAL ENERGY DEVELOPMENT CAPACITY GRANT

This program gives Federally-recognized tribes more resources to improve the economic influence of energy development

in their areas.

SMALL BUSINESS ADMINISTRATION 8(A) CERTIFICATION PROGRAM

This is not a grant, but rather a federally-funded initiative aimed towards helping minority-owned small businesses capture more

clients and work. It guarantees special government contracts that might otherwise be out of reach.

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Designed for entrepreneurs from low-income communities, Operation HOPE o�ers:

OPERATION HOPE SMALL BUSINESSEMPOWERMENT PROGRAM

Templates and guides

Counseling

Workshops

Connections to networks of lenders (and the SBA)

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THE NATIONAL AFRICAN AMERICAN SMALL BUSINESS LOAN FUND

NASBLF serves minority-owned small businesses in low or medium income communities in New York, Los Angeles, and Chicago.

MINORITY CHAMBER OF COMMERCE

A National Business Association non-profit that helps minority small business owners educate themselves, network, and connect with suppliers.

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SCORE

EPA SDB CERTIFICATION

O�icially the Service Corps of Retired Executives, SCORE mentors small business owners for free and provides more specialized workshops and seminar classes for an additional fee.

The Environmental Protection Agency gives special contracts, resources, and grants to certified Small Disadvantaged Businesses.

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Don’t forget to look through your state and city business programs and centers: many will have minority-oriented

financial education and networking programs of their own.

The NMBC o�ers contracting opportunities, equity funding networking, free resources, and minority-owned small

business news updates to its members.

LOCAL GOVERNMENT CENTERS

NATIONAL MINORITY BUSINESS COUNCIL

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ENTREPRENEURIAL ASSISTANCE PROGRAMLocated in New York, but has analogs in many other states.

Whether you’re looking for:

EAP centers can help

Business counseling

Business plan development

Financial education$

Networking opportunities

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MINORITY BUSINESS DEVELOPMENT AGENCY

O�ers tools and education to minority entrepreneurs. (According to their reports, minority-owned businesses

are responsible for $1.4 trillion in annual gross receipts!)

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Learn more at www.fundera.com