Best Business Loans for Minorities in February 2026

Where to get a minority business loan

Minority business loans are available from several kinds of lenders.

SBA lenders

SBA loans can be a good option for minority-owned businesses because they are typically affordable.

The SBA 7(a) loan program offers flexible funding for acquiring real estate, managing cash flow, refinancing debt and more. However, eligibility requirements can be strict, with minimum credit scores around 680, depending on the lender. 

SBA microloans typically have lower score requirements than other SBA loans, making them an attractive option for minority borrowers with low scores. Microloans range up to $50,000 and are usually managed by nonprofit, community-based organizations. 

The SBA 8(a) program provides resources for minority-owned businesses, including training, mentorship and guidance on securing government contracts. 

Traditional banks and credit unions

Many traditional banks and credit unions offer business loans with stricter eligibility requirements than online lenders or other financial institutions. However, several feature lending programs specifically for minority-owned businesses. 

Community development financial institutions (CDFIs)

The CDFI Fund is a Treasury Department initiative aimed at expanding access to capital for underserved communities. It provides funding to various financial institutions, including banks and credit unions, which in turn offer financing to disadvantaged borrowers. You can search online for certified CDFIs in your community. 

Online lenders

Online lenders often have more flexible credit, revenue and time in business requirements than traditional banks, making them more accessible. Some work with specific minority groups to connect business owners with funding. Your approval odds might be higher with an online lender, but rates and fees can also be higher. 

Important resources for minority entrepreneurs

Minority entrepreneurs can find educational resources, mentorship and other support through government and nonprofit organizations, including: 

• Minority Business Development Agency (MBDA): The MBDA connects minority-owned businesses with tools to expand, access capital and secure government contracts. 
• National Minority Supplier Development Council (NMSDC): Minority business owners can apply for various certifications and find leadership, marketing and operations programs through the NMSDC.
• Business Consortium Fund (BCF): The BCF works with the NMSDC and other small-business partners to connect entrepreneurs with financing options. 
• SBA HUBZone: Small businesses operating in historically underutilized business zones, or HUBZones, might qualify for this SBA program. It lets businesses compete for set-aside government contracts with a 10% price evaluation preference. 

Alternative business financing for minorities

Owners who do not qualify for business loans for minorities might consider the following alternatives: 

• Business grants: Grants are an attractive funding option for businesses because they usually don’t require repayment. Grants might be available for different minority groups. 
• Business credit cards: Business credit cards usually have high annual percentage rates (APRs), so they should be used carefully to avoid excessive interest costs. However, many business cards offer 0% intro APR periods, which can help you finance business purchases. 
• Peer-to-peer (P2P) lending: P2P lending platforms connect businesses with investors, potentially making these loans easier to access than bank funding. 
• Crowdfunding: Crowdfunding requires the support of many individuals to raise money for your business. Platforms include Kickstarter and StartEngine. 

How Buy Side rates business lenders

We evaluated 28 small-business lenders, focusing on key areas such as affordability, loan options, underwriting requirements, transparency and customer experience. Advertisers and partners don’t influence our methodology or ratings, as our research and editorial team maintains independence in using data-driven processes. We assessed each lender based on characteristics business owners might find appealing, such as offering traditional business loan products, discounts, application guidance, bad-credit options and solutions for short-term funding needs. We focused on lenders with at least $1 billion funded that have been in business for five years or more. We also verified that the traditional and online lenders offer loans in most states. Learn more about how Buy Side rates the best small-business loans using data-driven methodologies.

We weighted five factors to come up with our ratings: