• Accel Business Funding

Top Small Business Loans for Minority Entrepreneurs

Unfortunately, minority-owned businesses are often trailing behind the average small business in terms of annual revenue and access to capital. However, there are several business loans designed to assist disadvantaged business owners.

SBA 7(a) Loan

An SBA 7(a) loan is not designed only for minority business owners, any entrepreneur looking for funding is able to apply. For the last five years, around a third of all 7(a) loans were provided to minority business owners.

SBA Community Advantage Loan

SBA Community Advantage loans are given to local mission-based lenders like nonprofits to be given specifically to under-served business owners. While creditworthiness and ability to pay back a loan are still major factors, these loans can provide up to $250,000 to minorities, women, and veteran business owners.

SBA Microloan

While significantly less than other potential loans at around $50,000, SBA microloans come with numerous benefits to new minority entrepreneurs. These loans are provided to nonprofit lenders, who tend to direct funding towards under-served communities, and these lenders will often provide guidance and assistance to their start-up borrowers.

SBA 8(a) Business Development Program

While technically not a loan, business owners who are socially and economically disadvantaged as defined by the SBA can qualify for a certification. The government limits certain federal contracts only to these certified businesses to compete amongst themselves. This program also provides free business mentorship and training to certified businesses.

Nonprofit Loans

Nonprofit lenders such as Accion and Kiva provide favorable loans to minority small businesses. They will often have specific qualifications but are among the best options for minority business owners.

Union Bank Business Diversity Lending Program

Union Bank provides business loans and business lines of credit specifically for minority business owners. These loans tend to be offered at better terms and conditions than their traditional loans.

Business Center for New Americans

The BCNA works with immigrants, refugees, women, and minority entrepreneurs to provide short-term business loans from $500 to $50,000. This loan has looser qualifications than other financing options, making it another great startup loan for minorities.

USDA Business Loans

The USDA Business and Industry Loan Guarantee program are USDA-guaranteed loans that local lenders provide to rural small businesses. If your business is located in a town with less than 50,000 inhabitants, among other qualifications, then small business owners are provided up to $25 million with low interest rates, long repayment terms, and a 10-20% down payment.

Business Consortium Fund Loan

Business Consortium Fund loans are reserved exclusively for minority-owned businesses that did not qualify for other financing options. Loans can be between $500 to $50,000 with a 3% interest rate above the prime rate. Repayment can be as long as 7 years. To be eligible, minority-owned businesses have to be certified with the National Minority Supplier Development Council (NMSDC) and have a working relationship with an NMSDC corporate member.


Unfortunately, the average minority-owned business in the US tends to operate with much less capital. However, many governments and private loan programs help supplement this deficiency and are designed to assist your minority-owned business with the best possible financing options.

Accel Business Funding has many different funding options for all businesses and funded many businesses for more than $380 million. When banks say NO, we say YES to funding in 24 hours!


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