Best Business Loans for Minority Entrepreneurs
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How much do you need?
What is a business loan for minorities?
- Asian-Indian.
- Asian-Pacific.
- Black.
- Hispanic.
- Native American.
Where to get a minority business loan
SBA lenders
Minority depository institutions
Banks and credit unions
Community development financial institutions
Microlenders
Online lenders
Best minority business loans
A closer look at our picks for the best minority business loans
SBA 7(a) loans
Fora Financial
SBA Microloans
Giggle Finance
Huntington Bank
Wells Fargo
Accion
Alternative funding options for minority business owners
- Grants for minority entrepreneurs. The government and private organizations offer small-business grants for minorities. Opportunities often vary drastically from state to state.
- Venture capital. Venture capital firms are investment companies that fund startups and entrepreneurs in exchange for a percentage of ownership in your business. Firms like Oakland-based Kapor Capital and Harlem-based Harlem Capital are dedicated to closing the gap in venture capital that many minority-owned businesses experience.
- Self-funding. Self-funding, also known as bootstrapping, is another option to fund your business, if you have enough money in savings. You may also consider Rollovers as Business Startups (ROBS) transactions, which allow you to use retirement savings to fund your company. With self-funding you can save money on interest and avoid diluting your ownership; however, you are at risk of losing your own money if your business fails.
Resources for minority-owned businesses
Organization | Overview |
---|---|
The MBDA is a federal agency dedicated to supporting minority-owned businesses. It offers assistance securing capital, competing for contracts and identifying new opportunities. | |
The NMSDC is a national nonprofit organization that — in addition to its MBE certification process — partners with lenders and offers programs in executive leadership, marketing and operations. | |
Business Consortium Fund (BCF) is a nonprofit business development CDFI that works with the NMSDC to develop and fund certified minority-owned small businesses, particularly those with supply-chain contracts. | |
SBA 8(a) business development program | The SBA 8(a) program is a certification program that can help small businesses interested in government contracting improve their chances of winning bids. To qualify, your firm must be 51% controlled by “socially and economically disadvantaged individuals,” which includes minorities, women and veterans. |
The SBA’s HUBZone Program is a certification program dedicated to awarding government contracts to businesses in underutilized zones, specifically designated as HUBZones. HUBZone-certified businesses are eligible to compete for contracts that are specifically set aside for small-business owners, and get a 10% price evaluation preference. | |
The Emerging Leaders program, an SBA Office of Entrepreneurial Development initiative, works with high-potential, established small businesses in America’s underserved cities. Participants receive customized training and networking opportunities. | |
The SBA’s Office of Native American Affairs provides free resources and technical assistance to American Indian, Alaskan Native or Native Hawaiian small-business owners. |
What is a minority business loan?
What qualifies as a minority-owned business?
Are there benefits in getting certified as a minority-owned business?
Article sources
- 1. Federal Reserve. 2024 Report on Employer Firms: Findings from the 2023 Small Business Credit Survey. Accessed Apr 1, 2025.
- 2. U.S. Small Business Administration. 7(a) & 504 Summary Report. Accessed Apr 1, 2025.
- 3. U.S. Small Business Administration. 7(a) & 504 Lender Report. Accessed Apr 1, 2025.
Methodology
NerdWallet’s review process evaluates and rates small-business loan products from traditional banks and online lenders. We collect over 30 data points on each lender using company websites and public documents. We may also go through a lender’s initial application flow and reach out to company representatives. NerdWallet writers and editors conduct a full fact check and update annually, but also make updates throughout the year as necessary.
Our star ratings award points to lenders that offer small-business friendly features, including:
Transparency of rates and terms.
Flexible payment options.
Fast funding times.
Accessible customer service.
Reporting of payments to business credit bureaus.
Responsible lending practices.
We weigh these factors based on our assessment of which are the most important to small-business owners and how meaningfully they impact borrowers’ experiences.
NerdWallet does not receive compensation for our star ratings. Read more about our ratings methodology for small-business loans and our editorial guidelines.