When you’re starting a small business, access to capital is crucial to fund growth. However, historically speaking, small business lending is more limited for minority-owned businesses.
Part of the problem is that the U.S. Census reports that household net worth of minority families is lower overall than for Caucasians. If you are a minority business owner, how can you qualify for a minority business loan? Are there other options for small business lending that may boost your entrepreneurial efforts?
Small Business Lending for Minority Firms
There is a disturbing disparity between the net worth and ability to seek entrepreneur help for minority-owned businesses. That’s where minority business loans can help. If you fall into the government demographic category called “minority,” there is entrepreneurial help available in the form of small business loans. For example:
What if you cannot qualify for these loans or would prefer to avoid debt accrual at this stage of your business? There are established alternatives available.
Alternatives to Small Business Lending
What if you need funding for your small business but don’t want to accrue debt? You can start your business cash-rich if you have retirement savings. Known in the industry as a Rollovers as Business Start-ups (ROBS) this is a small business funding solution that allows entrepreneurs with retirement savings to utilize those funds for a cash infusion without interest, a withdrawal fee, or tax penalty. These flexible funding methods aren’t loans; they are a way to access your retirement savings to purchase or recapitalize a business.
If you chose the ROBS funding approach, you won’t accrue debt and don’t need a good credit score or existing cash on hand to start the process. However, there are some complexities to this process that you should consider:
If you have retirement savings and are looking to start or grow a small business, talk to our team about how you can leverage those funds now, so you'll have them when you need it most. Click here to download The Definitive Guide To 401(k)/ROBS Business Funding.
1684 South Broad Street | Suite 130, Lansdale,
Our mission is to make every Benetrends client our champion. For over 35 years, our Rainmaker Plan® has been tested and proven to work, providing a means for more than 17,000 entrepreneurs to achieve their dreams of business ownership, creating both jobs and prosperity. We are so confident in the Rainmaker Plan design that we stand fully behind our work, backing every client with our Rainmaker Guarantee.
Information provided by Benetrends Inc. is not intended to be used as legal or accounting advice, or as the sole basis for investment decisions, nor should it be construed as advice designed to meet the particular needs of an individual investor. Please seek the advice of legal or tax professionals, as appropriate, regarding the evaluation of any specific information, opinion, advice or other content.
© 2019 Benetrends, Inc. All rights reserved. Privacy Notice.