Small Business Loans for Minorities

By: EconomyWatch Content   Date: 5 January 2010

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 In the US, if you belong to an ethnic minority community, such as Asian-American or Hispanic, you are entitled to loans to fund your small business under the minority business development program. Across the country, there is various government and private entities that provide small business loans for minorities.

Small Business Loans for Minorities: MBDA

The Minority Business Development Agency (MBDA) is a federal agency dedicated to the cause of developing minority owned businesses in the US. MBDA provides funding for:

·        Minority Business Development Centers (MBDC)

·        Native American Business Development Centers (NABDC)

·        Business Resource Centers (BRC)

These centers assist minority entrepreneurs with all the resources needed for them to launch their business.

Small Business Loans for Minorities: How to get a loan

Here are some sources for you to access a minority business loan:

·        Start with the Small Business Administration (SBA). The SBA has many resources for such loan programs and can assist you in drafting a business plan and other resources.

·        Also, try the MBDA for comprehensive assistance on obtaining financing and links with other lenders, if you have a flawed credit history.

·        Check for non-profit organizations that offer financial assistance.

·        Explore various Small Business Investment Companies (SBIC). These are privately owned investment management companies that offer venture capital to minorities and small businesses. SBICs are regulated by the SBA.

Small Business Loans for Minorities: How to apply

·        Draft a high quality business plan that covers all bases, including product, market potential and projected profits.

·        Get a copy of your credit record. A good credit record will ease your loan process.

·        List all your assets before the loan executives. The SBA can help you prepare documentation regarding collateral, capital or guarantor.

·        Make sure you present your case before the bank in a professional manner. Convince them that you are trustworthy and responsible.

Additionally, as a minority business owner, you can establish an advisory board to accomplish a number of things, such as:

·        Demonstrating wide acceptance of the business concept

·        Enhancing the creditability of your business

·        Maximizing the possibility of an angel investor to inject funds into your venture


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