Minority entrepreneurs who own small businesses and want to help them evolve could use small business loans for minorities with bad credit. Small businesses owned by minorities tend to grow at a faster pace. Nevertheless, minority-owned businesses might find securing financing a challenge. Minority entrepreneurs may have fewer assets and a lower credit score to secure their loans compared to other business owners.
Specialists indicate that the average credit score of a minority-owned small business is 707. This is 15 points lower compared to the average of a small-business owner in the US. In what follows, we will provide a list of best small business loans for minorities with bad credit that can help entrepreneurs.
Small Business Loans for Minorities with Bad Credit
However, entrepreneurs should know that if their small business has an operating history which is less than a year, their funding options may be limited. Usually, lenders prefer established small businesses that have operations and a track record which produce enough capital to support the loan repayments.
This lender offers fast access to working capital. Kabbage is a great option for borrowers who do not have a perfect personal credit. Kabbage does not focus on e-commerce data, accounting or banking, being a good fit for business owners who have voluminous credit histories.
This option is also suitable if entrepreneurs need a loan really fast. You can fill in an online application, and you can get approval for a line of credit and receive funds in just a few days. Kabbage offers loans of up to $150,000, and the repayment terms can be of 6 or 12 months.
This is an online lender who provides lines of credit and invoice financing, being suitable for small business owners who need capital right away. If you have many unpaid customer bills, Fundbox might be just the right kind of loan for you. By using their invoice financing, you can borrow up to $100,000 while also getting 100% of the value of invoices that your customers need to pay.
This is suitable for when you want to obtain a loan really fast. With invoice financing, you can get funds in 2-3 days. However, if you want a line of credit, you can get your approval during the same day.
OnDeck offers convenience and consumers speed just like you would find at a bank. However, you should know that they might charge you a higher annual percentage rate. The personal credit score for term loans is usually 500 and 600 for lines of credit. This could also work for you if you have an uneven cash flow. The line of credit from OnDeck may help you until revenue comes back.
To obtain this loan, you can apply via your phone or online, and if you get the approval, you will receive the funds within 24 hours.
This online lender is meant to help businesses which found their financial footing. This is a great option for borrowers who have a strong cash flow and who are trying to find contract financing. StreetShares combines alternative and traditional underwriting practices. The lender focuses on cash flow, indicating your business’s ability to repay the loan.
These small business loans for minorities with bad credit can help any entrepreneur obtain a loan in just a few days after applying for a line of credit. All you have to do is to fill in the online form and be confident. These loans can help you boost your business’ success rate.
Image Source: NerdWallet