Business Loans for Women help aspiring and established female entrepreneurs get the financing they need to keep their business running. From Small Business Administration loans to business grants, women can find a variety of funding options.

Check with your local banks and credit unions to see if they offer women-centric initiatives. These may include personal guarantees or a lower collateral requirement than standard bank loans.

Banks

Whether you’re looking to purchase commercial equipment or a point-of-sale system, business loans for women can help you make large purchases. These types of loans typically have longer repayment periods, but their interest rates are lower than credit cards. You can find this type of financing through online lenders, local banks and credit unions. Some of these lenders publicize initiatives that support female entrepreneurs, while others don’t.

When searching for the best small business loan for women, look for lenders that offer competitive rates and a fast funding process. Consider also checking into local programs that provide grants to women business owners, as well as organizations that offer financial guidance and development opportunities for women in entrepreneurship.

While women-owned businesses are making a significant contribution to the economy, many still face difficulty in securing business financing. This is largely due to gender bias in traditional lending institutions, according to a U.S. Senate report. While this type of bias may be unconscious, it can negatively impact the likelihood of a woman’s loan application being approved.

Fortunately, there are plenty of alternatives to banks for business financing. Known as fintech lenders, these digital financiers can provide quick approval for business loans and lines of credit that are personalized to the needs of your company. Many of these lenders have less strict requirements than banks and the SBA, and are more forgiving of bad credit and debt.

SBA

Women-owned businesses generate trillions of dollars in revenue each year and create jobs. But when it comes to getting financing, female entrepreneurs face more obstacles than men. In 2022, women-owned businesses had 25% of their loan applications denied versus 19% of male-owned companies. To overcome these funding challenges, female entrepreneurs should consider every financing option available to them, including Small Business Administration loans and alternative lenders.

SBA loans are backed by the government and offer competitive interest rates for qualifying applicants. These funds come with a variety of maximum maturities, from 10 years for working capital to 25 years for real estate, depending on the type of funding needed. Lenders typically require that borrowers provide some form of collateral, such as personal or business assets.

In addition to requiring a strong credit history, the SBA also sets minimum size requirements for its business loans. These size standards vary by industry and can be measured based on annual receipts, number of employees or total value of inventory.

The SBA offers an online tool to help you determine if your company meets size requirements. Once you have confirmed that your business does meet the requirements, it is time to apply.

Nonprofit Lenders

The number of women-owned businesses in the United States is growing at twice the rate of all businesses. These companies employ nearly 9 million people and generate $1.8 trillion in revenue. However, despite their economic impact, women receive just 4% of conventional small business loans and venture capital. Many financing options exist for female entrepreneurs seeking to grow their business, from traditional bank loans and credit unions to online lenders and community development organizations.

Many mission-based nonprofit organizations offer microloans to local women entrepreneurs. These loans typically have short terms and low interest rates. Other funding options include merchant cash advances, which allow borrowers to borrow against future credit card receipts and invoice financing, which lets business owners use outstanding invoices as collateral.

Personal loans can also be an option for women who don’t qualify for other types of funding. These types of loans generally have shorter term and higher interest rates than other forms of financing. However, they can be an effective way to address a short-term funding need or a financial emergency.

Regardless of which type of financing you choose, it’s essential to understand the risks associated with a loan. Repayment plans can create a financial burden and disrupt your business, so be sure to take into account how much you can afford to pay back when choosing a loan amount.

Loan Guarantee Program

The Tory Burch Foundation offers women entrepreneurs mentoring, networking and funding through its Capital Program. The foundation doles out loans through Community Development Financial Institutions that specialize in lending to small businesses and provides each woman entrepreneur with a financial mentor. As with standard small business loans, a personal guarantee is required to ensure the lender will get its money back if the borrower fails to make payments. The foundation also offers a loan guarantee program that helps small businesses purchase equipment. This option could be helpful for women-owned startups that lack a lengthy operating history or good credit.

The SBA has several programs that target different types of small businesses, including those owned by women. These programs offer competitive terms, repayment schedules and interest rates. The SBA also has microloan programs that are designed for startup companies and early-stage small businesses, and it has CDC/504 and Community Advantage loans that go to small businesses in historically underserved communities.

Many nonprofit organizations and mission-based lenders also offer small business loans for women. These organizations often focus on financing businesses that are owned by people of color, women and veterans, which can improve the chances of a woman-owned business being approved for a loan. These organizations also have more lenient credit guidelines than traditional banks and online lenders.