Studies have revealed a steady increase in the number of minority-owned businesses in the United States, growing to 11.1 million in 2017, a 79 percent increase between 2007 and 2017. However, such businesses owned by Asians, Blacks, Hispanics, or Native Americans do not get equal access and opportunities, particularly when it comes to securing financing. A survey conducted by Biz2Credit in 2016 on over 1,500 minority business owners showed that over 36% admitted that lack of adequate funding was their biggest challenge.
It is worth noting that there are several funding options and business loans for minorities tailored to help them grow their businesses. Some of these options are highlighted as follows:
Small Business Administration (SBA) Loans for Minorities: SBA loans for minorities come in different forms such as SBA 7(a) loans, SBA 8(a) Business Development program, SBA Microloan program, and SBA Community Advantage loans. Each loan has distinct features and benefits to meet the specific needs of each business owner.
Lending Programs for Minority Business Owners: There are quite a number of lending programs designed to address the funding needs of minority business owners. These programs include Business Center for New Americans, Minority and Women Revolving Loan Trust Fund Program, Union Bank’s Business Diversity Lending Program, and Business Consortium Fund loan.
Resources and Grants for Minority Small Businesses: Minority small businesses can also take advantage of several grants and resources specifically designed to meet their funding needs. These grants include Minority Business Development Agency (MBDA), Operation HOPE Small Business Development Program, First Nations Development Institute Grant, and National Minority Business Council.
In addition to the funding options highlighted above, there are other financing solutions that minority business owners can take advantage. However, it is advised that business owners carefully assess each loan and the terms before making a decision.