Because of discrimination and other barriers to entry for female entrepreneurs and women-owned businesses, special business loans for women and associated programs were created.
Far from being discriminatory in and of themselves, these programs aim to level the playing field for women entrepreneurs and women-owned businesses, and allow them to compete in the marketplace based on their abilities, management, and the innovation and value of their products and services.
Read on to learn more about small business loans for women and how they can help women-owned businesses to succeed.
Why Business Loans for Women?
It’s unfortunate, but women entrepreneurs have long been discriminated against, just as women have been across the board in business, financing, and other areas.
Many studies have shown that women with equally-good finances, background, and performance are still seen as a higher lending risk, have lower credit scores, and get approved for fewer loans and credit products.
It can only be concluded that this is largely due to gender-based discrimination. As such, many government and private-sector programs have been created to combat this discrimination.
By providing specialized avenues for women-owned businesses to access small business loans for women, small business funding, and other kinds of credit products, the legacy of this discrimination can be offset to some extent, providing more opportunities for women entrepreneurs and their businesses to thrive.
Qualifying for a Loan for Women-Owned Businesses
To obtain a small business loan for women-owned businesses, you need to obviously meet the qualifications as a women-owned business.
These are established by the US Small Business Administration (SBA), though sole proprietorships, LLCs, and entrepreneurial ventures generally qualify in addition to true “small businesses” when it comes to applying for small business funding.
Most non-bank, private lenders, such as BizFly Funding, also have minimum requirements for lending that look at things like credit score, time in business, and revenue in order to qualify for small business loans for women.
As an example, the criteria at BizFly Funding for loans for women-owned businesses include:
Business Loans for Women with Bad Credit
As you can see from the above requirements, it’s also possible to obtain business loans for women with bad credit.
This is important, as we noted earlier that many women and women-owned businesses have credit scores that, statistically, are significantly lower than male counterparts with virtually identical financial details.
There are also other factors that result in women and women-owned businesses often having lower credit scores, including the rejections and more difficult time they have in obtaining small business funding to begin with.
It can be a vicious cycle – you need credit to obtain credit, and being denied access to credit makes it harder to grow and improve your credit score.
Fortunately, private, non-bank lenders like BizFly Funding offer small business loans for women with fairly low credit score requirements – in BizFly’s case, 500 or greater.
This is much more attainable for most women and women-owned businesses than the credit score requirements at banks and traditional financial institutions, which are typically several hundred points higher.
Business loans for women with bad credit further help to address the history of discrimination and ensure that women and women-owned businesses aren’t held back based on credit score factors that are often beyond their control.
Where to Apply for Small Business Funding and Women Entrepreneurs’ Loans
It’s best to apply for small business loans for women and women entrepreneurs’ loans from a private, non-bank lender like BizFly Funding.
Banks and traditional financial institutions are slow to change, and you’re more likely to find a legacy of discriminatory practices and have more difficulty working with these funding sources as compared to non-bank lenders.
That’s not to say bankers or financial institutions are misogynistic or that it will necessarily be a problem, but you’re more likely to have issues there than with private companies focused on small business funding.
At the same time, the credit score, revenue, and time in business requirements at private lenders like BizFly Funding tend to be more generous and easy to meet than those from banks and institutional lenders.
This is because most of those financial houses are very risk-averse, and don’t like to deal with small business funding of any type, regardless of whether or not it’s a women-owned business.
Banks can reject upwards of 80% of applicants for many of their loan and credit products, and set a much higher bar to qualify.
Private lenders are more open to assessing your lending risk overall, and not relying so heavily on your credit score as the sole determining factor in providing your loan.
When it comes to loans for women-owned businesses, this is effectively doubly beneficial, with a greater likelihood of approval and more specific options to obtain small business funding from private lenders like BizFly Funding.
Small Business Loans for Women from BizFly Funding
If you’re the owner or operator of a small business and a woman, or associated with a woman-owned small business in need of loans or credit, then consider small business loans for women from BizFly Funding.
BizFly Funding is a private, non-bank lender based in the US that specializes in small business funding options.
Whether you need a women entrepreneurs’ loan, business loan for women with bad credit, or other forms of small business loans or small business funding, BizFly Funding is a great choice.
They offer a fast and easy online application process, and you can get funded in as little as 1 business day. To find out more or start the application, visit https://bizflyfunding.com.
Frequently Asked Questions about Business Loans for Women
While it may seem simple to say that women can get small business loans just as easily as men, by applying for them outright, it’s sadly not that simple.
Women are still discriminated against in many aspects of life, even if unintentionally, and finance is no exception.
Women are less likely to be approved for small business funding, and are seen as higher risk business leaders by many banks and financial institutions.
Credit scores of women and women-owned businesses can also be artificially low compared to their male counterparts.
To combat this problem, and help level the playing field, small business loans for women – special programs to increase lending to women and women-owned businesses – was put into place at many lenders.
These programs can help provide loans for women owned businesses more easily, and ensure that businesses can gain access to the funding they need to succeed – regardless of the gender of their owners or leadership team.
The US Small Business Administration (SBA) handles registration and certifications of a variety of business classes, as well as provides numerous resources for small business owners.
To become a certified woman-owned small business, you’ll have to meet the qualifications from the SBA.
Briefly, these include specifics on ownership, decision-making, day-to-day operations, and size of the businesses.
You can find out more and start the registration process at the SBA website.
Traditionally, it’s been far more difficult for women to obtain access to small business loans, small business funding, and financing in general, both in their personal lives and their professional lives.
That’s one of the reasons why special business loans for women and loans for women-owned businesses were developed and instituted.
It helps to even out inequities in the lending and finance system, and allow women entrepreneurs and business owners to compete on an equal playing field, on the merits of their ideas and business acumen, and not their gender.
Section 8a of the Small Business Administration (SBA) is a program and certification that provides business training and development help for businesses that are owned by socially and economically disadvantaged individuals.
This is primarily a minority-owned business program, though handicaps, gender, and other factors can also be used to qualify for the program.
Application and requirement info can be found through the SBA. An 8a certification is generally not required to qualify for small business funding specifically aimed at women, such as small business loans for women from private, non-bank lenders.
In addition to various programs, training, and resources available from the federal government, minority-owned and women-owned businesses often have an advantage in negotiations or competitive bidding on business.
In retail and wholesale, for example, many major retailers consider the minority or disadvantaged status of potential vendors when making a sourcing decision, as it can be beneficial for them.
All things being equal, women-owned businesses and minority-owned businesses can gain an advantage due to their status – which isn’t really an advantage, but, again, leveling the playing field to make up for historical discriminatory action.
This is the same reason that these special business loans for women and women entrepreneurs’ loans exist.