As a minority business owner, you have beaten the odds. In a world where minorities own less than 25% of businesses, you are one of those that made it happen.

However, in the life of a business owner, you come up against turbulent times.

Whether it’s a recession, pandemic, supply shortage, or something else, some occurrences come about that can’t always be planned for or accommodated. When these situations occur, the business you worked so hard to have is in danger of shutting down.

It is during these times where it’s often necessary to seek financial assistance. For those businesses that are minority-owned, there are unique options available. But how do you find small business loans for minorities? How do you take advantage of these special financing offers?

Access To Capital For Minority-Owned Businesses

There are many avenues to tap into to acquire capital for your minority-owned business. Not only can you find loans, but also microloans, business line of credit, grants, federal small business loans for minorities, and crowdfunding.

You can find these funding types in various places, including foundations, community organizations, banks, and online. It is important to note that your options will also depend on what amount you are seeking.

For example, if you were looking to acquire a $50K business loan, you could consider alternative lenders, traditional banks, online lenders, among others. Additionally, you could have access to conventional loans, grants, and lines of credit.

Some organizations will notify you when minority-owned offerings and grants are available. One way to get notified for minority-specific capital is to obtain certifications for your business. These can include:

  • SBA 8(a)
  • Minority Business Enterprise (MBE)
  • National Minority Supplier Development Council (NMSDC)
  • Disadvantaged Business Enterprise (DBE)
  • Women-Owned Small Business

Once you have secured your certification with one or more organizations, you are eligible for special funding offered through them, as well as notifications when new offerings are available.

There are many minority organizations and certifications throughout the United States, the most common being the SBA minority-owned business certification. Many organizations also provide certifications locally; you are not limited to the national ones listed above.

How To Find Minority Small Business Loans

As we previously stated, it is common for business owners to believe that the only route to acquiring a loan is through a bank or credit union. However, many places offer funding that is not your traditional lending institution. Many of these can also offer lower rates on your loans.

  • ROK Financial - Small Business Loans
  • Community Development Financial Institutions (CDFIs)
  • Small Business Administration (SBA)
  • Small Business Development Centers (SBDCs)
  • SCORE Association

It is best to research all of your options to get the best rate available. Many online lenders can offer lower rates than brick and mortar businesses. Finding a lender that works with your needs is the first step to getting on the right track.

Small Business Grants For Minorities

Finding grants for minority-owned businesses is becoming easier by the day. In addition to securing certifications as a small business that is minority-owned to get inside access to new offerings and financing, you can also use several online grant websites.

There are many companies and sites out there that cater to minority small businesses looking for how to apply for a minority business grant. Some of them include:

  • Bootstrap Capital
  • The Solutions Project
  • Small Town Development Grant
  • SoGal Foundation Black Founder Startup Grant
  • Small Business Innovation Research (SBIR)
  • Grants.gov
  • FedEx Small Business Grant
  • Governmentgrants.us
  • National Black MBA Association Scale-Up Pitch Challenge
  • USDA
  • Small Business Technology Transfer (SBTT)
  • Sephora Accelerate
  • Operation Hope
  • Coalition To Back Black Businesses Fund
  • National Association for the Self-Employed (NASE)
  • Rural Business Development Grants
  • Rebuild the Block Grants
  • First Nations Development Institute Grants
  • Asian Women Giving Circle
  • NAACP X Bacardi Backing The B.A.R. Acceleration Grants

Some companies and organizations have grant programs available to minorities, as well as small business loans for minority females, grants for black-owned businesses in 2021, and minority small business grants for covid-19,. The list above is not comprehensive, and new options come up daily. To find one that works best for you, take the time to search regularly for ones that meet your needs.

How Do I Qualify For a Minority Business Loan?

Although it is not always necessary to have an up-to-date certification that states your business is minority-owned, you will need ownership documentation to qualify for a minority-specific business loan.

To show lenders that your company is minority-owned, you need to prove that your organization is controlled at a minimum of 51% by those considered minorities. Those who are considered minorities include:

  • Latin/Hispanic
  • Black
  • Asian
  • Native

Those in control who associate with a race mentioned above need to be at least 25% in ethnic makeup to qualify. This information is given through interviews with the lender and by providing the business incorporation paperwork.

Minority Financing Options With Bad Credit

Anyone can get distressed when trying to find financing with bad credit. However, there are options out there that can help you when you are feeling lost. Additionally, many are specific to minority-owned businesses.

If your business is struggling and your credit isn’t as high as you’d like, it is worth checking these companies. They have programs and options available to those in situations like yours.

Summary

Running a business can be stressful in itself. When you add on unexpected life events that you cannot prepare for, it elevates that level. The fear of having to close down the business you worked so hard to build up is palpable.

It is essential to know that there are small business minority loans out there. Some companies and organizations have the sole purpose of helping minority-owned businesses during the most challenging times.

With all the lending options, grants, micro-loans, loans for minority business owners, and certifications available, you can pick and choose the path that works best for you and your company. Minority-owned businesses make up a small number of companies out there, and these programs want to ensure that they stay open in the future.

About the Author, Madison Taylor

Madison Taylor is the Brand Ambassador at ROK Financial. She is responsible for raising brand awareness and business relationships with business owners across the country. Madison loves that she plays a small role in getting Business Back To Business Through Simple Business Financing and looks forward to hearing what you think about the blogs she creates!Madison has been working in the financial space for six years, and loves it! When she is not at work, you will find her at home learning a new recipe to test out on her family or going on new adventures with her friends.