Are you a minority in need of a loan to start a business? If YES, here are 9 best sources of small business loans for minorities with bad personal credit and how to get it.
Starting a business can sometimes be very stressful because there are times when you may not have the wherewithal to start or run your business. For times like this, the wisest thing to do is to seek for startup loan from a capable person or organization.
The same way majorities seek business loans, so do minorities because not very many people have ready cash to start a business. This is one of the reasons why some organizations have taken it upon themselves to fund small business startups for minorities.
It might be difficult to get a clear picture of who a minority is in the united states of America, but on the other hand, African Americans, Arabs and other Middle Eastern Americans, Asian-Pacific Americans, Haitians, Inuit and Alaska Natives, Latinos, Native Americans and Native Hawaiians amongst others are considered minority groups in the United States and these sets of people can access loan facilities specifically designed to help them start and run their business in the United States.
Here are some of the small business loans that someone who is a minority in the United States of America can easily access especially when they are qualified for it.
9 Source of Small Business Loans for Minorities With Bad Credit
- SBA 8(a) Business Development Program
If you are a minority in the United States of America and you intend applying for a loan to start your business, your best bet is to go for an SBA express loan. This happens to be one of the most affordable financing options for a minority owned business in the United States.
To qualify for this loan, you must have a 680+ credit score, $120,000+ in annual revenue, and have been operating for at least 2 years, then you may qualify for up to $5,000,000 with a recommended SBA loan provider, SmartBiz. They offer 10-25 year loans with rates that start at 6.75%. You can get prequalified online in minutes.
Socially or economically disadvantaged small-business owners are eligible to receive help through this SBA program which provides business development assistance, training, management and technical guidance. Please note that in order to qualify for this loan, your business must be at least 51 percent owned and controlled by a US citizen.
Another platform that gives out small business startup loans to minorities in the United States is the Federal Government of the United States and you can apply via grants.gov. This government website allows grant seekers to find and apply for federal funding opportunities.
It contains information on more than 1,000 grant programs across all 26 federal grant-making agencies, including the Department of Commerce and the U.S. Small Business Administration.
To apply for federal grants as a minority, you must first obtain a DUNS number from Dun & Bradstreet (a unique nine-digit identification number) for your business; register to do business with the U.S. government through its System Award Management website; and create an account at Grants.gov.
- Small Business Innovation Research and Small Business Technology Transfer Program
Small Business Innovation Research and Small Business Technology Transfer Program is yet another program that issues out small business startup loans to minorities in the United States of America. These two programs provide contracts and grants for early-stage small businesses that are looking to commercialize innovative biomedical technologies or any related business within the research and technology industry.
As a minority in the United States who intends starting any technology or research based business, then your best bet is to apply to Small Business Innovation Research and Small Business Technology Transfer Program for small business startup loans.
- The USDA Rural Business Enterprise Grant Program
Another good avenue to raise startup capital for your small business as a minority in the United States is via the USDA Rural Business Enterprise Grant Program. This grant is specifically designed for the development or expansion of small businesses in rural areas — minority-owned or not.
In order to qualify for this small business startup loan, you’ll need to have 50 or fewer employees, less than $1 million in revenue and be located in an eligible rural area as defined by the United States government.
Please note that this loan or grant typically ranges from $10,000 to $500,000, and can be used for a variety of purposes including training and technical assistance, acquisition or development of land and long-term business planning. Applications are accepted through the USDA’s Rural Development’s state offices once every year.
- Operation Hope Small – Business Empowerment Program
Operation Hope Small – Business Empowerment Program is yet another ideal program specifically designed to help minorities in the United States finance their business ideas or boost their business. This program is designed for aspiring entrepreneurs in low-wealth neighborhoods, which often include minority communities.
The program combines business training and financial counseling along with access to small-business financing options. Applicants complete a 12-week training program, plus workshops on business financing and credit and money management.
- National Association for the Self-Employed
National Association for Self – Employed is a nonprofit trade association that provides educational resources and grants for small businesses and entrepreneurs with keen interest in minorities.
In order to apply for a grant of up to $4,000, you will need to become an active member of the association, provide a detailed explanation of how you will make use of the funds, explain in details how the grant will support your business growth, and of course you are expected to provide supporting documentation when applying for the grants.
- FedEx Small Business Grant Contest
FedEx Small Business Grant Contest is another avenue for minorities to generate startup capital for their small business. This annual grant contest by FedEx awards 10 small businesses with grants of up to $25,000. Since 2013, FedEx has awarded more than $375,000 in grants to entrepreneurs. Any for-profit small business especially those run by a minority that has been operating in the United States for at least six months is eligible to contest for the available grants.
- Minority Business Development Agency
Minority Business Development Agency is an agency of the U.S. Department of Commerce and this agency is established with the main aim of promoting the growth of minority – owned small businesses by connecting owners to financing resources, federal contracts and market opportunities. If you are a minority and you are interested in accessing this opportunity, you can contact a local MBDA business center for more information.
- National Minority Supplier Development Council
The National Minority Supplier Development Council is a corporate member organization focused on increasing business opportunities for certified minority-owned businesses under the United States’ law. The National Minority Supplier Development Council operates the Business Consortium Fund, a nonprofit business development program, which offers financing programs and business advisory services for its members.