How to Find Small Business Loans for Women

Female business owners can find small business loans for women to help fund their business.  That’s not their only option though. The key, I think, lies with the terminology. The truth is, there are some funding options that are geared specifically toward women.  However, they are few and far between, and they aren’t really loans. While some female geared organizations offer funding options for women only, they are typically in the form of grants.  

During the COVID-19 situation, there are still loans out there which are specifically for women. But women entrepreneurs should also be looking into SBA Paycheck Protection Program funding.

Is There a Secret Sauce to Finding Small Business Loans for Women?

It isn’t a bad idea to pursue these options.  Yet, that can’t be where it ends. Honestly, you cannot rely solely on specific small business loans for women.  In fact, what you are really looking for are loans available to everyone that may work better for women than others.  Regardless, you need to position your business to be fundable no matter the gender of the owner. If there is a secret sauce, fundability is it.

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Small Business Loans for Women: The Small Business Administrationsmall bus loans for women Credit Suite

When it comes to small business loans for women, the Small Business Administration is the cornerstone. Basically, since the loans are guaranteed by the government, they are easier for almost anyone to qualify for than regular traditional loans. Here’s a sample of the loan programs the SBA offers. 

7(a) Loans 

This is the Small Business Administration’s flagship loan program. It offers federally funded term loans up to $5 million. The funds can be used for expansion, purchasing equipment, working capital and more. These funds are distributed through traditional lenders. 

504 Loans 

These loans are also available up to $5 million and can buy machinery, facilities, or land. They are generally used for expansion.  Similarly, private sector lenders or nonprofits process and disburse these funds. Furthermore, they work especially well for commercial real estate purchases.  

Microloans 

Microloans are available in amounts up to $50,000. They work for starting a business, purchasing equipment, buying inventory, or for working capital. For these, community based nonprofits handle funds as intermediaries. 

SBA Express Loans 

These loans max out at $350,000 and have a much faster turnaround. In fact, the SBA takes 36 hours or less to make a decision. Also, there is not as much application paperwork.  As a result, they are a great option for working capital if you qualify. 

Other SBA Resources for Women

Remember, take a minute to check out the other resources the SBA offers for female entrepreneurs. For example, the Office of Women’s Business Ownership.  Their goal is to enable and empower business owners that are women via advocacy, outreach, and education as well as assistance.

Small Business Loans for Women: Private Lenders

Next, if the SBA doesn’t work out, or if you still need more funding, there are some private lenders for small business that tend to work well when it comes to loans for women in business. 

Lending Club

LendingClub functions as a peer-to-peer lender.  It offers mostly fixed-term small business loans. Borrowers that get loans from LendingClub generally use loans funds to buy equipment, finance growth or expansion projects, consolidate other debt, or even hire new people.

Lendio

Lendio offers a loan-connection service that dramatically cuts the time it takes for small business owners to find the perfect loan.  The key is, they do the legwork by vetting a network of competing small business lenders. With Lendio, funding is fast.  It sometimes takes as little as 24 hours.  

Blue Vine

BlueVine offers two options for small business financing.  They include lines of credit and invoice factoring.  Also, they offer the ability to talk with a financing advisor. Their application process takes place exclusively online.  The minimum loan amount is $5,000 and the maximum is $100,000.  To be eligible for financing from BlueVine,  you must be in business for at least 6 months, have revenue of $120,000 per year or more, and have a credit score of at least 600.  

Kiva

Kiva has a different lending model. In fact, their platform is vastly different.  They are a kind of  cross between crowdfunding and lending.  Surprisingly, their  loans have a 0% interest rate. That means, even though you have to pay it back, it is actually free money. In addition, there is no credit check. The only requirement is that you have to get at least 5 family members or friends to donate money for your business.  Furthermore, you yourself have to give at least a $25 loan to another business on the platform. 

Grameen

In contrast to most,  Grameen actually does offer microloans specifically for women.  The loan amounts range from $2,000 to $15,000.  They also offer financial training and support.  

As a bonus, they report payments to Equifax and Experian.  Consequently, these loans help borrowers build credit.

Small Business Loans for Women: Other Resources that Can Help

It can be a good thing to work with these organizations when you are trying to find small business loans for women. Truly, each exists to support and aid women business owners in their small business endeavors.  The tips, tricks, and support they offer can make all the difference in finding loans for women in business.   

Association of Women’s Business Centers

The AWBC runs a network of business centers geared toward women.  These centers work hard to help women succeed.  They offer training, business development, financing, and mentoring opportunities. 

National Association for Female Executives

Also known as NAFE, this organization does a lot as well.  For example, they sponsor events, provide training, and extend other resources to help female business owners achieve success.  

National Association of Women Business Owners

In the same way, the NAWBO works nationwide to offer training, events, and other resources to female owned businesses across the country. 

SCORE

 SCORE is the country’s largest network of expert business mentors that volunteer their time with more than 300 chapters and 10,000 volunteers.  They connect female business owners with mentors.  Alternatively, they can participate in a workshop to help them learn what they need to know to be successful.

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Small Business Loans for Women: A Better Option

The thing is, your gender should not define the funding you are eligible to get.  While the nature of our society dictates this somewhat, there are things you can do to ensure your business if fundable despite your gender.  Any business, woman owned or not, should be fundable to ensure the availability of funding whenever needed. So, while you are looking for small business loans for women, make sure your fundability is in order.  

Start with the Foundation

Your business cannot be fundable if it is not set up properly.  That includes the following. 

  • Don’t Use Personal Contact Information for Your Business

This includes a business phone number and fax number,  business address, and email address. Not just any email address though.  It needs to have the same URL as your website. More on that in a bit. 

  • Dump the SSN for an EIN

An EIN is an identifying number for your business that works in a way similar to how your SSN works for you personally.  You can get one for free from the IRS.

  • Get Incorporated

Incorporating your business as an LLC, S-corp, or corporation is non-negotiable when it comes to building fundability for your business. .  

  • Open a Business Bank Account

Open a separate, dedicated business bank account.

  • Licenses

Do the research you need to do to ensure you have all of the licenses necessary to legitimately run your business at the federal, state, and local levels. 

  • Website

Spend the time and money necessary to ensure your website is professionally designed and works well.  Also, pay for hosting. Don’t use a free hosting service

Small Business Loans for Women: What Else Makes a Business Fundable?

The set up is not the end of the story however.  It simply sets the business up to build fundability. After that is done, the actual building begins.  Unfortunately, it may be more of a matter of damage control than building in the beginning, depending on history. 

Business Credit Reports, Business Credit History, and Credit Score

These detail the credit history of your business.  They are a tool to help lenders determine how credit worthy your business is.  

The most common places for lenders to pull a business credit report from  are Dun & Bradstreet, Experian, Equifax, and FICO SBSS.  Since you have no way of knowing which one your lender will choose, you need to make sure all of these reports are up to date and accurate. 

Lenders will be looking not only at your credit score, but your detailed credit history including: 

  • How many accounts are reporting payments?
  • How long have you had each account? 
  • What type of accounts are they?
  • How much credit are you using on each account versus how much is available?
  • Are you making your payments on these accounts consistently on-time?

Other Business Data Agencies 

There are other business data agencies that affect those reports indirectly.  Two examples of this are LexisNexis and The Small Business Finance Exchange. They gather data from different sources, including public records.  This means they could even have access to information relating to automobile accidents and liens. 

Identification Numbers 

Dun & Bradstreet is the largest and most commonly used business credit reporting agency.  Every credit file in their database has a D-U-N-S number.  To get a D-U-N-S number, you have to apply for one through the D&B website. You have to have this number to have a file with D&B, and you have to have a file with D&B to build business credit. 

Business Information

This is a problem because of those fraud concerns lenders have.  When business information doesn’t match up, it sets off alarms.  Maybe your business licenses have your personal address but now you have a business address.  You have to change it.  Perhaps some of your credit accounts have a slightly different name or a different phone number listed than what is on your loan application. Do your insurances all have the same information?

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Financial Statements

Both your personal and business tax returns need to be in order.  Not only that, but you need to be paying your taxes, both business and personal.  

Bureaus

There are several other agencies that hold information related to your personal finances that you need to know about.  For example, ChexSystems issues reports with information on bad checks. These reports can affect your bank score.  If you have too many bad checks, you will not be able to open a bank account.  That will seriously affect fundability. 

Anything can come back to haunt you.  Have you ever been convicted of a crime? Do you have a bankruptcy or short sell on your record?  How about liens or UCC filings? All of this can and will affect the fundability of your business. 

Personal Credit History

Your personal credit score from Experian, Equifax, and Transunion affect the fundability of your business.  The number one way to get a strong personal credit score or improve a weak one is to make payments consistently on time. 

The Application Process

Everything about this affects whether or not you can get funding for your business.  Is your application complete and accurate? Are you applying for a loan product that fits your needs?  Is the timing right? Did you find a good lender match?

There is More to Funding than Finding Small Business Loans for Women

There is certainly nothing wrong with female business owners seeking small business loans for women.  They are a great first stop. In fact, now is a great time to borrow with the Fed cutting rates due to the coronavirus economic downturn.   Still, no one should let their funding hinge on their gender. If you work to build fundability for your business, whether you can get funding for your business will never be a question again. 

In fact, when you need funding and you have strong fundability, lenders will be competing to give you money.  With a deep understanding of what makes your business fundable, you will find you can get more funds with lower interest rates.  Gender has nothing to do with fundability, so don’t let it dictate the future of your business. Use gender specific financing to get started if you need to, but focus on total fundability to ensure ongoing business growth.

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