Small Business Loans for Women 2024 – Top Compare Options
Reviewed by Jazmin Castello - MBA
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According to the National Association of Women Business Owners (NAWBO), over 11.6 million businesses are owned by women. However, the chances of women-owned businesses being approved for a small business loan are lower as compared to businesses owned by men.
Luckily, business loans for women are widely available, and there are resources such as Women’s Business Centers that are backed by the government to provide adequate training to bridge the funding gap.
The ideal business loan for your entity is the one that will meet your business needs and cost you the least amount of money.
Here are some of the top seven small business loan offers for women’s business ownership, including great options for startups as well as average or bad credit borrowers. Read on to find out more information regarding grants and a wide array of other loan programs for women-owned businesses to help you compare small business loans.
Top 7 Small Business Loans For Women 2024
- SBA 7 (a) Loan – Best Overall
- Fundbox – Line of Credit – Best loans for women with average or bad credit
- OnDeck – Online Term Loan – Best flexible loans
- BlueVine – Line of Credit – Best business credit card and startup business loans
- Accion Opportunity Fund – Best microloans
- Funding Circle – Online term Loan – Best peer-to-peer lender
- Lendio – Best customer support
Features of the Best Small Business Loans For Women – SBA 7 (a) Loans
- Highly competitive interest rates
- Low fees
- It’s possible to access longer repayment terms
Top 7 Small Business Loans For Women 2024
SBA 7(a) Loan
SBA loans are loans offered to businesses and they are guaranteed partially by the US Small Business Administration and provided by participating lenders (such as the California finance lender loans) and credit unions, which in most cases are banks. Although SBA loans usually have tight standards of lending, their low rates of interest, merchant cash advance and flexible terms make them ideal for financing your business.
- They are available as both business line of credit and term loans
- SBA interest rates are typically capped
- Customers have the option to choose long repayment terms
- SBA community advantage loans usually have a low, upfront guarantee fee. Presently, loans that are less than $350,000 are being waived
- A personal guarantee is mandatory
- Processing times may be significantly longer as compared to what online lenders offer
- Collateral is usually necessary
To qualify for SBA loans as a female business owner, your business must be registered as a for-profit business entity. In addition, you must employ alternative financial resources first, including personal assets and business assets. The financial qualifications for SBA loans often vary depending on the lender.
The maximum business loan amount that female entrepreneurs can receive from an SBA loan is $5,000,000 and the minimum credit score is 650.
Fundbox – Line of Credit
Fundbox is an established online lender providing the best small business loans that are tailored for the female entrepreneur who wants to quickly receive cash-flow. This lender is popular because it offers flexible eligibility conditions and it has a swift, easy registration process. Its main benefit is that it offers to finance the next business day.
- They offers small business financing within a short approval time – usually one business day
- Fundbox is startup friendly in that it even lends early stage businesses who’ve been in business for a minimum of six months
- Fundbox doesn’t charge prepayment penalties, inactivity charges, or business bank account maintenance charges
- The process of application is quite easy and involves minimal documentation
- Its rates are higher than traditional banking institutions
- It’s not ideal for building business credit
- Fundbox could need personal guarantee
Fundbox offers women entrepreneurs funding under three main conditions. First, the small business owners must have a minimum credit score of not less than 600. Secondly, you should have been in business for at least six months. Third, the minimum revenue of the business should be $100,000 per year. Moreover, Fundbox offers a maximum loan amount of $150,000.
OnDeck – Online Term Loan
OnDeck is a perfect fit for your business if you require quick cash flow, have enormous impromptu business-related expenses, have uneven cash flow, and have a personal credit score that is less-than-stellar.
- They offers financing within the same business day
- The loan application process usually involves less paperwork than the majority of online business lenders
- It has a low minimum credit score
- It requires personal guarantee and business line
- Ondeck requires frequent repayments
- It has a fixed pricing structure
Customers can opt to apply for a loan via their phones or online. The process takes less than 10 minutes and if the application goes through, the customers will receive same-day financing for a small business loan.
The minimum credit score for the loan applicant should be 600, although the majority of borrowers usually have credit scores ranging between 680 and 720. Customers can receive a line of credit instantly for withdrawals that range between $1,000 and $10,000. In addition, its fast turnaround on business financing means that you can receive cash-flow in a pinch.
BlueVine – Line of Credit
Blue Vine is a renowned lender that provides online business loans and business lines of credit to a tune of $250,000 and it can be a suitable option for women entrepreneurs in need of short-term working capital for their businesses.
- Swift financing – customers can receive funding within 12 to 24 hours
- It has a low minimum credit score requirement
- Blue Vine offers multiple term repayments to cater for various financing needs
- Blue Vine is ideal for startups because it allows borrowers who have been in business for at least six months
- They offers flexible eligibility requirements
- Blue Vine requires weekly loan repayments
- It also needs personal guarantee
- Blue Vine is not available to customers from Vermont, NorthDakota, and South Dakota.
Blue Vine is renowned because it has an easy process of application where borrowers can link their business checking accounts and receive a decision in a brief period.
They offer lines of credit with repayment terms of 6 to 12 months. Its estimated APR range is between 15% and 78% and customers can choose whether to repay their installments weekly or monthly.
To qualify for BlueVine small-business loans, you should have been in business for not less than six months and have a credit score of 600. Also, the minimum yearly revenue from your business should be $120,000.
Accion Opportunity Fund
As a women owned business, Accion Opportunity Fund is a good fit for your business if you’re not in need of an enormous amount of money. More so, you can work collaboratively with Accion’s loan team to determine which business loan options of financing will meet the needs of your business.
- Swift financing – Microloans tend to be easier to disburse as compared to huge amounts of capital
- The eligibility qualifications at Accion Opportunity Fund are more lenient than SBA microloan program.
- Accion Opportunity Fund microloans are perfect for your business if you don’t need a huge amount of capital
- It’s not ideal if you require high amounts of working capital
- The repayment period is considerably shorter
To qualify for Accion Opportunity Fund’s microloans, you must have a minimum of one year in business and the minimum revenue of your business is $50,000 annually. The microloans offered by this lender to women entrepreneurs range between $5,000 and $100,000.
Notably, the loan application and funding process take about three to five business days and the terms can range between one year and five years depending on the loan you want.
Funding Circle – Online Term Loan
Funding Circle is a peer-to-peer lender which plays the role of a matchmaker, linking women owned small businesses to investors who can help with funding. It’s great for your business if you’re intending to expand your company or refinance some costly debts. Funding Circle business loans can also be a great fit if you have an established business with good credit and are looking for quick cash.
- Funding Circle usually offers women owned business loans in three business days
- There is no minimum revenue requirement
- Funding Circle’s pricing structure is quite competitive among other established businesses
- Funding Circle offers lower rates than other online lenders
- Its processing times are faster than banks and SBA loans
- Funding Circle is not accessible in Nevada
- It requires personal guarantee and business line
The maximum loan amount that Funding Circle can offer is $500,000 and it offers its small-business loans to clients with a minimum credit score of 660. To qualify for its loans, you should have been in business for a minimum of two years.
Your business should also not have run into any bankruptcies in the last seven years. Fortunately, Funding Circle does not require your business to have a minimum yearly revenue.
Lendio
First, it’s important to note that Lendio does not provide its loans. Instead, it links small businesses for women to independent and traditional lenders. However, the application process is easy and less time-consuming. A huge advantage of using Lendio is that it is extremely secure. It employs encryption technology to safeguard the personal loan and financial information of their clients.
- Lendio has a simple and quick loan approval process
- It’s fees are transparent – it has no hidden fees
- Lendio has a knowledgeable, friendly customer support team
- It has a low credit score approval
- Lendio has a wide array of lenders and funding
- It requires 6 months of your financial statements
- The number of its small business lending partners has decreased since the beginning of the coronavirus pandemic
- The financing process is longer
Lendio is a financial institution that collaborates with around 15 lending partners (this figure was 70 before the pandemic). To qualify for its loan offerings for small businesses, your business should have a credit score of 500 and above and be in existence for at least two years.
More so, they will request for your bank statements for the past six months as well as your tax returns for two years.
Types Of Small Business Loans For Women
- SBA Loans
Women owned businesses can take advantage of SBA loans for funding, including the popular SBA 7 (a) loans. Financial institutions offer small business loans and the US Small Business Administration backs them.
- Bank Business Loans
Large banks often provide low cost business loans but they have strict eligibility requirements. In the last three years, small banks approved around 69% of applications from women owned businesses while large banks approved 50%.
- Online Loans
If you have a low credit score (usually around 300 to 689) or your business has been in existence for less than two years, an online lending company could come in handy. Online lenders usually provide numerous products, have less stringent eligibility qualifications, and facilitate swift invoice financing.
- Microloans
The majority of mission-based not-for-profit institutions provide microloans to local business entities, mainly concentrating on entities owned by veterans, people of color, and women. Microloans are great if your business can’t qualify for a loan with an online lender or regular bank.
Alternative Lenders and Funding Resources For Female Business Owners
Business Grants
Female entrepreneurs can receive free funding via small business grants offered by several nonprofit institutions and government agencies. These business grants exist to enable women owned and disadvantaged businesses to compete fairly with male business owners.
Women’s Business Centers
They are a network comprising over 100 educational centers in the US to help women from businesses and expand them. These centers conduct workshops and seminars on a wide variety of topics, including how to raise working capital.
Federal Contracting Programs
These programs are designed for female small business owners who are interested in federal and government contracts. They allow economically and socially disadvantaged entities or individuals, including women-owned businesses, to compete for federal contracts.
Ascent Online learning platform
This is free digital business equipment that was developed in 2021 in a joint collaboration between the White House, the US Department of the treasury, and the Women Bureau at the US Department of Labor. It provides quizzes, tools, as well as other resources to help female entrepreneurs who want to expand their entities.
National Association of Women Business Owners
It’s headquartered in Washington, D.C., and consists of more than 5,000 members and 60 chapters across the US. It provides information regarding several aspects, including access to working capital.
National Women’s Business Council
This council works collaboratively with the Office of the President, the SBA, and Congress to tackle issues affecting women business owners. It offers business training and resources to help in startups, conferences, mentor groups, and alternative lender programs.
Frequently Asked Questions (FAQs)
Yes, it does. Certified women owned businesses are usually considered for federal projects that have been set aside for certified women owned businesses.
Women running a business are as qualified for small business loans as men. However, there are business loans specifically that are tailored for women and minority business owners.
Business loans for women with bad credit scores do exist, but you will pay interest that is higher than those with impressive credit scores.
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