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We’ll start with a brief questionnaire to better understand the unique needs of your business.
Once we uncover your personalized matches, our team will consult you on the process moving forward.
Here are 7 minority business loans
| Lender | NerdWallet Rating▼ | Max loan amount▼ | Min. credit score▼ | Next steps |
|---|---|---|---|---|
SBA 7(a) loan with Fundera by NerdWallet | Best for established businesses | $5,000,000 | 650 | with Fundera by NerdWallet |
Fora Financial - Online term loan with Fundera by NerdWallet | 4.7/5 Best for startups or bad credit | $1,500,000 | 570 | with Fundera by NerdWallet |
SBA Microloan with Fundera by NerdWallet | Best for loan amounts of $50,000 or less | $50,000 | 620 | with Fundera by NerdWallet |
Giggle Finance Merchant Cash Advance with Fundera by NerdWallet | Best for self-employed individuals | $5,000 | 300 | with Fundera by NerdWallet |
Huntington National Bank - Lift Local Business Program | Best for minority veterans | $150,000 | Undisclosed | Read Review |
Accion Opportunity Fund - Small Business Working Capital Loan | 4.9/5 Best for minority women | $250,000 | 600 | Read Review |
Wells Fargo Small Business Advantage® Line of Credit | 5.0/5 Best for bank business loans | $50,000 | 680 | Read Review |
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Our pick for
established businesses
SBA 7(a) loans offer competitive rates and terms and can be used for a variety of funding needs. So far in fiscal year 2025 (which started on Oct. 1, 2024), minority business owners have received over $2 billion in 7(a) loans.
SBA 7(a) loan
Max loan amount
$5,000,000
Min. credit score
650
Est. APR
10.50-14.00%
Pros
- Large borrowing maximums.
- Interest rates are capped.
- Long repayment terms available.
Cons
- Collateral is typically required.
- Longer processing times than online lenders.
Low interest rate
SBA 7(a) loan
Max loan amount
$5,000,000
Min. credit score
650
Est. APR
10.50-14.00%
SBA 7(a) loans offer competitive rates and terms and can be used for a variety of funding needs. So far in fiscal year 2025 (which started on Oct. 1, 2024), minority business owners have received over $2 billion in 7(a) loans.
7(a) loans are issued by private lenders and backed by the SBA. They offer long repayment terms and low interest rates.
Pros
- Large borrowing maximums.
- Interest rates are capped.
- Long repayment terms available.
Cons
- Collateral is typically required.
- Longer processing times than online lenders.
Qualifications:
- For-profit U.S. business.
- Unable to access credit on reasonable terms from nongovernment sources.
- Financial qualifications determined by individual lender.
Low interest rate
Our pick for
startups or bad credit
If you have a credit score of 570 or higher and at least six months in business, you may be able to qualify for a short-term loan from Fora Financial.
Fora Financial - Online term loan
Max loan amount
$1,500,000
Min. credit score
570
Pros
- Cash can be available quickly.
- Get a discount for prepaying.
- No collateral required.
- Low minimum credit score requirement.
Cons
- Charges a factor rate that makes it more difficult to compare costs with other lenders.
- Can’t build business credit.
- Longest loan term is 18 months.
- Charges an origination fee.
Fora Financial - Online term loan
Max loan amount
$1,500,000
Min. credit score
570
If you have a credit score of 570 or higher and at least six months in business, you may be able to qualify for a short-term loan from Fora Financial.
Fora Financial can be a good fit for borrowers who may fall short of qualifying for traditional bank financing or young but established small businesses looking for speedy financing.
Pros
- Cash can be available quickly.
- Get a discount for prepaying.
- No collateral required.
- Low minimum credit score requirement.
Cons
- Charges a factor rate that makes it more difficult to compare costs with other lenders.
- Can’t build business credit.
- Longest loan term is 18 months.
- Charges an origination fee.
Qualifications:
- In business for at least six months.
- At least $20,000 per month in revenue.
- No open bankruptcies or dismissed bankruptcies within the past year.
Our pick for
loan amounts of $50,000 or less
SBA microloans offer smaller loan amounts and more flexible qualification requirements compared to other SBA loan programs. So far in fiscal year 2025, 45% of SBA microloans have gone to minority-owned businesses, including Black- and Asian-owned businesses.
SBA Microloan
Max loan amount
$50,000
Min. credit score
620
Est. APR
8.00-13.00%
Pros
- Can be used for a variety of funding purposes.
- Designed to finance traditionally underserved businesses.
- Startups and business owners with bad credit may be able to qualify.
- Competitive interest rates, low fees and long repayment terms.
- Intermediaries typically offer business training and educational resources.
Cons
- Loan amounts max out at $50,000.
- Can’t be used to pay existing debt or purchase real estate.
- Collateral is likely required.
- Slow funding timeline.
SBA Microloan
Max loan amount
$50,000
Min. credit score
620
Est. APR
8.00-13.00%
SBA microloans offer smaller loan amounts and more flexible qualification requirements compared to other SBA loan programs. So far in fiscal year 2025, 45% of SBA microloans have gone to minority-owned businesses, including Black- and Asian-owned businesses.
SBA microloans are small-sized loans funded by the U.S. Small Business Administration and issued through approved intermediaries, typically nonprofit and community lenders.
Pros
- Can be used for a variety of funding purposes.
- Designed to finance traditionally underserved businesses.
- Startups and business owners with bad credit may be able to qualify.
- Competitive interest rates, low fees and long repayment terms.
- Intermediaries typically offer business training and educational resources.
Cons
- Loan amounts max out at $50,000.
- Can’t be used to pay existing debt or purchase real estate.
- Collateral is likely required.
- Slow funding timeline.
Qualifications:
- Be a U.S. business.
- Show your ability to repay the loan.
- Personal guarantee and collateral likely required.
- Specific financial qualifications determined by individual lender.
Our pick for
self-employed individuals
Giggle Finance offers loans up to $5,000 for freelancers and contractors. Its flexible qualification requirements make it a good fit for minority business owners who are struggling to qualify for other financing.
Giggle Finance Merchant Cash Advance
with Fundera by NerdWallet
Max loan amount
$5,000
Min. credit score
300
Pros
- No minimum credit score requirement.
- Same-day funding available.
- Specifically designed for freelancers and self-employed individuals.
Cons
- Funding maxes out at $5,000.
- Factor rate and fee information not available on website.
- Charges an origination fee.
Giggle Finance Merchant Cash Advance
Max loan amount
$5,000
Min. credit score
300
Giggle Finance offers loans up to $5,000 for freelancers and contractors. Its flexible qualification requirements make it a good fit for minority business owners who are struggling to qualify for other financing.
Giggle Finance provides capital to freelancers, contractors and self-employed individuals.
Pros
- No minimum credit score requirement.
- Same-day funding available.
- Specifically designed for freelancers and self-employed individuals.
Cons
- Funding maxes out at $5,000.
- Factor rate and fee information not available on website.
- Charges an origination fee.
Qualifications:
- Minimum credit score: All credit scores may be accepted (ranging from 300 to 850).
- Minimum time in business: Three months.
- Minimum annual revenue: $36,000.
Our pick for
minority veterans
Huntington Bank’s Lift Local Business Program offers loans between $1,000 and $150,000 to minority-, women- and veteran-owned businesses at any stage of growth.
Huntington National Bank - Lift Local Business Program
Max loan amount
$150,000
Min. credit score
Undisclosed
Pros
- Loans starting as low as $1,000.
- No origination fees.
- SBA loans offered with SBA fees paid by Huntington.
- Free financial entrepreneurial courses.
Cons
- Low maximum loan amounts.
- Program only available in certain U.S. states.
- Limited information on terms and fees available online.
Huntington National Bank - Lift Local Business Program
Max loan amount
$150,000
Min. credit score
Undisclosed
Huntington Bank’s Lift Local Business Program offers loans between $1,000 and $150,000 to minority-, women- and veteran-owned businesses at any stage of growth.
Huntington National’s Lift Local Business loan program is designed to support minority-, woman- and veteran-owned small businesses from startup and on.
Pros
- Loans starting as low as $1,000.
- No origination fees.
- SBA loans offered with SBA fees paid by Huntington.
- Free financial entrepreneurial courses.
Cons
- Low maximum loan amounts.
- Program only available in certain U.S. states.
- Limited information on terms and fees available online.
Qualifications:
- No bankruptcies in the last 4 years.
- Requirements for credit score, time in business and business revenue not disclosed.
Our pick for
minority women
Accion is a nonprofit lender that primarily issues loans to business owners in traditionally underserved communities, including women and people of color.
Accion Opportunity Fund - Small Business Working Capital Loan
Max loan amount
$250,000
Min. credit score
600
Est. APR
8.49-24.99%
Pros
- Loan amounts from $5,000 to $250,000.
- Customized loan terms.
- No prepayment penalty.
Cons
- Slower processing speed compared with online lenders.
- Charges an origination fee.
- Not available in all U.S. states.
Accion Opportunity Fund - Small Business Working Capital Loan
Max loan amount
$250,000
Min. credit score
600
Est. APR
8.49-24.99%
Accion is a nonprofit lender that primarily issues loans to business owners in traditionally underserved communities, including women and people of color.
Accion is a good option for businesses that haven't been able to secure traditional financing. The lender targets its funding efforts toward minority, women and low-to-moderate-income entrepreneurs.
Pros
- Loan amounts from $5,000 to $250,000.
- Customized loan terms.
- No prepayment penalty.
Cons
- Slower processing speed compared with online lenders.
- Charges an origination fee.
- Not available in all U.S. states.
Qualifications:
- Minimum credit score: 600.
- Minimum time in business: 12 months.
- Minimum annual revenue: $50,000.
Our pick for
bank business loans
Wells Fargo’s unsecured line of credit is designed for companies with less than two years in business and may be easier to qualify for than other bank loans.
Wells Fargo Small Business Advantage® Line of Credit
Max loan amount
$50,000
Min. credit score
680
Est. APR
12.00-14.00%
Pros
- Bank line of credit (backed by the SBA) with competitive interest rates.
- No annual fee or prepayment penalties.
- Available to borrowers with less than two years in business.
- Does not charge an origination fee.
Cons
- May take longer to fund than online lenders.
- Credit lines only available up to $50,000.
- Need a Wells Fargo checking account to access online bill pay.
Wells Fargo Small Business Advantage® Line of Credit
Max loan amount
$50,000
Min. credit score
680
Est. APR
12.00-14.00%
Wells Fargo’s unsecured line of credit is designed for companies with less than two years in business and may be easier to qualify for than other bank loans.
Wells Fargo offers an unsecured line of credit that’s designed for borrowers with less than two years in business.
Pros
- Bank line of credit (backed by the SBA) with competitive interest rates.
- No annual fee or prepayment penalties.
- Available to borrowers with less than two years in business.
- Does not charge an origination fee.
Cons
- May take longer to fund than online lenders.
- Credit lines only available up to $50,000.
- Need a Wells Fargo checking account to access online bill pay.
Qualifications:
- Minimum credit score: 680.
- Available to borrowers with less than 24 months in business.
- Household personal liquid assets must be less than $500,000.
- Must meet standard SBA loan requirements.
A closer look at our picks for the best minority business loans
SBA 7(a) loans
Best for established businesses
How it benefits minority business owners: The U.S. Small Business Administration says it is committed to supporting minority-owned businesses, as well as underserved small-business owners. The SBA supports efforts to equalize lending to small businesses by guaranteeing business loans through private lenders — therefore incentivizing them to lend more and at lower rates. So far in fiscal year 2025, the SBA’s 7(a) program has loaned almost $2.3 billion to minority-owned businesses.
SBA 7(a) loans can be used for a wide array of business purposes, and offer low rates and favorable terms to those who qualify. If you are a fairly established business and can afford to wait for financing, SBA 7(a) loans are a good option for you.
Be mindful of: One thing to watch out for with SBA loans is that they typically take a long time — longer than online lenders and some traditional loans — to process and be funded. Make sure you discuss the timeline of funding with your lender, and account for it during your planning.
Read more about SBA 7(a) loans.
Fora Financial
Best for startups or bad credit
How it benefits minority business owners: Fora Financial’s minimum credit score requirement of
570
makes it a good option for minority business owners who have found that their personal credit score stands in their way of accessing capital. Fora is also unique in allowing business owners to borrow more capital once at least 60% of their loan is repaid. Be mindful of: Fora Financial’s use of factor rates rather than APRs makes its loans more expensive and difficult to compare with other options. Make sure you understand what the loan is really costing you by converting the factor rate into an APR.
Read our full Fora Financial review.
SBA Microloans
Best for loan amounts of $50,000 or less
How it benefits minority business owners: SBA microloans are typically offered through nonprofit, community lenders, and have more flexible requirements than other SBA loans. Many larger lenders don’t find it lucrative to lend in small amounts; however, if your business is forced to take more money than it needs, it can end up doing more harm than good. SBA microloans fill that gap.
In addition to funding, the SBA has several programs that support minority-owned businesses, including government contract programs like the 8(a) program, the Mentor-Protégé Program and T.H.R.I.V.E. Emerging Leaders Reimagined, which provides education and resources to businesses in underserved cities. It also partners with agencies like the Minority Business Development Agency (MBDA) and hosts initiatives at several Historically Black Colleges and Universities (HBCUs) around the country.
Be mindful of: Like other SBA products, SBA microloans can take a while to fund, so you’ll want to make sure you’ve built that into your timeline.
Read more about SBA microloans.
Giggle Finance
Best for self-employed individuals
How it benefits minority business owners: Giggle Finance’s same-day funding can be a lifeline for minority freelancers, contractors or self-employed individuals. It requires $
36000
in annual revenue, 3
months in business and has no minimum credit score requirements. Be mindful of: Giggle’s loans are merchant cash advances (MCAs) which tend to be one of the most expensive forms of financing. Even though it doesn’t offer large funding amounts, the cost of financing and daily required payments could trap you in a bad cycle of debt.
Huntington Bank
Best for minority veterans
How it benefits minority business owners: Huntington Bank is consistently one of the top SBA lenders in the country. So far in FY 2025, Huntington has funded almost 1,500 SBA 7(a) loans totaling over $350 million. The bank’s Lift Local Business Program supports minority business owners through capital access, free business education and personalized business planning support, and is available to businesses in any stage. Newer minority-owned businesses can benefit from the low fees, access to a free business checking account and free educational courses.
Be mindful of: Huntington’s Lift Local Business Program has loan maximums that are capped at $
150000
, something to be mindful of if you’re in need of more capital.» MORE: Best business loans for veterans
Wells Fargo
Best for bank business loans
How it benefits minority business owners: Wells Fargo’s Small Business Advantage Line of Credit has no annual fee and can offer low rates to minority business owners who qualify based on creditworthiness. Spending on the line also qualifies for Wells Fargo’s Business Rewards Program, which can be used for card payments or to purchase merchandise.
Be mindful of: The maximum amount for this line of credit is only $
50000
. It’s best to use this loan to help cover small cash flow gaps.Read our full Wells Fargo business loans review.
Accion
Best for minority women
How it benefits minority business owners: Accion is a nonprofit community development financial institute that is dedicated to addressing financial inequity in underserved communities. It provides personalized offers and options that work best for your unique needs. Minority business owners who are new to business ownership or the loan application process may benefit from working with a specialist on a personal level.
After funding, Accion also provides a resource library plus free mentoring and coaching to its borrowers.
Be mindful of: Similar to SBA loans, small-business loans from Accion can take longer than other lenders due to its personalized process. If you don’t feel like you need a hands-on touch, you may consider other lenders that can provide a faster process.
Read our full Accion review.
What is a business loan for minorities?
A business loan for minorities is a loan targeted toward members of minority communities, and is aimed to help them access capital when they might not otherwise be able to. A business is typically considered to be minority-owned if it’s at least 51% owned and operated by a person of specific ethnicities. For example, the National Minority Supplier Development Council (NMSDC), defines a minority business owner as an American citizen who is at least 25% of any of the following groups:
- Asian-Indian.
- Asian-Pacific.
- Black.
- Hispanic.
- Native American.
Some certification agencies or lending institutions also extend their definition to other underserved groups, such as women, veterans or LGBTQ business owners.
Where to get a minority business loan
SBA lenders
One of the best SBA loan options for minority-owned businesses is working with Community Advantage Small Business Lending Companies (CA SBLCs), previously Community Advantage lenders. Although the SBA Community Advantage program expired on Oct. 31, 2023, the CA SBLC license allows these lenders to issue regular 7(a) loans. CA SBLCs will continue to prioritize loans for business owners in underserved markets.
Minority depository institutions
Minority depository institutions (MDIs) are mission-driven banks that provide banking services and loans to underserved communities. They are officially defined as financial institutions whose voting stock is at least 51% owned by minority individuals, or if the majority of the board of directors is part of an underserved community and the primary community served is predominantly minority.
Banks and credit unions
Banks and credit unions typically offer the most competitive business loans, and some — such as U.S. Bank, Huntington Bank, Fifth Third Bank and Native American Bank — offer lending programs dedicated to minority-owned businesses. Traditionally, minority business owners have faced difficulties in getting approved for small-business bank loans due to issues like unconscious bias, credit challenges or limited banking history. However, if you can qualify for a business loan from a bank, this will likely be your most affordable option.
Community development financial institutions
Community development financial institutions, or CDFIs, are banks, credit unions and other institutions that provide financial access, including loans, to minorities or economically disadvantaged communities. Many CDFIs also utilize the SBA microloan program, and provide other resources, like counseling and networking, for minority-owned businesses.
Microlenders
Many mission-based nonprofit organizations offer microloans to local businesses, often focusing on businesses owned by minority groups, women and veterans. Microlenders typically offer small loan amounts up to $50,000. These loans can have more flexible qualification requirements, but eligibility and loan terms will vary by lender.
Online lenders
Online business lenders tend to have more flexible eligibility requirements than traditional banks, and many target funding access to minority-owned businesses or other underserved communities. Some online lenders work with startups or borrowers with bad credit. While minority applicants have a better chance of getting approved with online lenders than banks, the loan will likely cost more.
Alternative funding options
The government and private organizations offer small-business grants for minorities. Opportunities often vary drastically from state to state.
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, 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.
» MORE: Business grants for Black women
Resources for minority-owned businesses
Government and nonprofit organizations may offer free assistance to minority entrepreneurs. These resources may help you gain access to alternative financing options, educational tools or advice from industry experts.
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. |
Last updated on January 2, 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.
Wondering if you qualify?
It’s possible to get a business loan even if you have bad credit. Bad-credit business loans are available from alternative sources, like online or nonprofit lenders.
See Your Loan Options
Frequently Asked Questions
Loans for minority-owned businesses can be referred to as minority business loans. The term can be used to designate lending programs that support funding for minority-owned small businesses and entrepreneurs from underserved communities.
Typically, a business is defined as minority owned when an American citizen who is at least 25% Asian-Indian, Asian-Pacific, Black, Hispanic or Native American has at least 51% ownership in the enterprise. This definition can vary based on the organization.
Minority-owned business certification is not typically required to obtain a loan, but it can be helpful in securing business opportunities with large companies or government agencies.