NEW YORK, NY (January 30, 2018) - The number of minority-owned small businesses has skyrocketed in the past decade, growing by 79% - ten times faster than the overall growth rate for all small businesses in that time period.
11.1 million businesses in the United States are owned by minorities; yet these communities are drastically underserved in the world of business financing. The Minority Business Development Agency at the Department of Commerce reports that minority-owned firms are much less likely to be approved for business loans, and receive lower amounts and higher interest rates.
“These discrepancies have made minority business owners more likely to not apply for small business loans, usually out of fear of rejection,” reports Jared Weitz of Forbes.
A study from the Center for Global Policy Solutions, based on the U.S. Census Bureau’s Survey of Business Owners (SBO), analyzed business owners by race from 2007-2012 and found that firms owned by people of color have contributed a great deal to the U.S. economic recovery following the 2008 financial crisis. During that five-year period, non-white business owners added more than 72.3% of the jobs created by privately held companies. Nearly all minority entrepreneur groups experienced significant growth in the number of their firms. That’s just a fraction of the potential, according to the report. Discrimination, both past and present, is inhibiting the true growth of these businesses. Without that, an additional 1.1 million businesses could be established and could produce an estimated 9 million more jobs. This would increase the nation’s income by $300 billion.
SourceFunding.org is designed to be the transparent, sustainable, low-cost, and user-centric alternative to predatory online lenders by providing access to financing solutions that are the right fit for each applicant. We compare borrower characteristics against the internal guidelines of thousands of lenders to match small business borrowers with the lenders most prepared to provide high quality financing - improving the chance of success for minority applicants.
Read more about our mission of financial inclusion here.