Are you a woman seeking a small business loan? Perhaps you have been somewhat intimidated by the process, worrying that you may face problems getting the money you need to start and grow your business. Going to your friends and family to borrow the money is out of the question and your personal savings aren’t enough. Fortunately, it’s easier than ever before for women to obtain small business loans. Financial institutions now see women as very capable business owners and are more than happy to provide additional capital to make running a successful business a reality.
HOW MANY WOMEN SMALL BUSINESS OWNERS ARE THERE TODAY?
According to the US Department of Labor and the National Association of Women Business Owners, here are some interesting facts on women business owners.
- As of 2015, there are more than 9.4 million firms owned by women, and they supply 7.9 million jobs that generate $1.5 trillion in sales.
- 9 million companies are majority-owned by minority women in America.
- One in five firms with revenues totaling $1 million or more are owned by women.
- Women-owned businesses account for 31% of all privately held organizations, yet they provide 14% of employment and 12% of US revenues.
- 2% of women-owned companies are operating at $1 million dollars or more.
Chances are, you know of multiple thriving businesses in your own community that are owned solely by women. We live in a great time in America, where women are moving up in ranks and closing the earning gaps with men across many industries.
WHY IT’S GETTING EASIER FOR WOMEN TO OBTAIN SMALL BUSINESS LOANS
The good news is that there are many ways for women to obtain small business loans, even if they have credit challenges. It’s getting easier for women to get small business loans, because:
BANKS AND FINANCIAL INSTITUTIONS VIEW WOMEN AS STRONG BUSINESS OWNERS
Nowadays, there are no restrictions on women to start their own business ventures, identify new business opportunities, and seek out the finances they need. Banks and other financial institutions see women as viable business owners.
MORE WOMEN IN DECISION-MAKING POSITIONS IN THE FINANCE WORLD
There are more women in positions of power today. The Center for American Progress estimates that women make up more than half of the labor force in the financial services industry, with 12.4 percent in executive positions.
ADDITION OF MORE WOMEN-FRIENDLY BUSINESS BUILDING PROGRAMS IN EVERY COMMUNITY
In most towns, there are growing networks of women in business who are supporting the development of more women-owned businesses. Local organizations often have business building programs specifically for women.
10 WAYS TO GET A SMALL BUSINESS LOAN – A GUIDE FOR WOMEN ENTREPRENEURS
If you are ready to pursue small business loans for women, there are ten steps you will want to take to get started on the right foot. Use this as a general guide to obtaining the right financing.
- Establish a small business with sound business principles
Start your business with good financial practices, including a trusted financial institute that can provide you with a variety of flexible small business loan programs and lending options.
- Register your business with an EIN, bank account, and separate finances
Treat your business as a separate entity from your personal financial portfolio. Get an official business name, a tax identification number, and a business bank account established from day one.
- Get your business approved as a women-owned business
Check with the Small Business Administration for help getting certified as a women owned business. This can help you become eligible for additional business opportunities and lending options.
- Connect with education and resources from the Minority Business Development Agency and SCORE via the Small Business Administration
Take advantage of all the free and low cost educational opportunities that can teach you about how and where to get the best small business loans for women. This can be a good place to get the support you need to build a strong business, and references for affordable small business loan companies like United Capital Source.
- Update and complete financial reports for your small business
Using your accounting system, be sure to run regular reports that show your profit and loss, expenses and write offs, taxable income and paid taxes, and outstanding receivables. You will need this information when you apply for a small business loan.
- Obtain several small lines of credit for your business and pay your bills on time
Give your business a promising start on a good business credit rating with lines of credit with vendors and credit card companies. These will help you obtain low interest small business loans.
- Check your credit score with all 3 credit bureaus
Periodically, check to see where your business stands in terms of its credit score. Check all three credit reporting agencies as they may differ somewhat. Knowing your credit score can help you secure the best rate.
- Explore small business loan programs for women entrepreneurs
Do your homework and seek out well-reviewed small business loan programs and bad credit loan programs for women. You’ll find more options that you can imagine, including factoring programs and working capital loans, for example.
- Apply for the small business loan programs that are the best fit for your business
It is important to talk with a knowledgeable financial representative who can go over the various small business loan options for women. Only apply for the amount and type of program that’s right for your company.
- Maintain good repayment terms and take out future loans for larger amounts
The best part about taking out a small business loan for women is that you have flexible repayment terms that can allow you to pay it on time. Do this, and you will likely have no trouble at all getting more loans in the future.