Manual on Government Small Business Loans for Women

Business scenarios around the Globe are constantly changing dramatically, and the point to be noted here is, it is a positive one. One that we should cherish and uphold with pride.

As per statistics over the years, the business world witnessed a huge paradigm shift. About close to 47% of Female owners took the front stage in venturing new business last year while the counterparts are trailing behind with 44%. Although women can show positive growth in handling business and venturing into a new business, they are still trailing behind the men when it comes to bagging business loans.

What could be the reason for this?

Reasons For Low Loans Application Rate:

Fewer percent look for loans:

It is noted that only close to 25% of women look for investors for their start-ups.

Use a credit card:

Close to 46% of women entrepreneurs use credit cards to meet the immediate cash need instead of looking for loans.

Funds declined:

When compared, men (34%) tend to get loans quicker than women (31%).

Let’s first discuss why and when women entrepreneurs should opt for microloans?

Despite all the growth and huge percentage of profit earned by women entrepreneurs, it’s a sad case that not many understand the importance of a business loan or, say, Microloans for women for start-up companies.

It is very important to understand that these loans come with varied benefits and prove to be a boosting factor for smooth cash flow. Women entrepreneurs should opt for these microloans for women before setting the business or post when they find that financial crunch to expand the business.

What type of business or Microloans can women look for?

Women can look for any one of the below-mentioned funding options based upon their business requirements.

A business line of credit:

In a layman’s language business line of credit is similar to how you use credit cards, where it comes with a limit cap, and the borrower can use the amount as and when required. The payments can be made partially or fully.

Revolving line of credit:

These are the most flexible and sought-after types that many borrowers prefer. The revolving line also has a credit limit, such as the business line credit, but here as long as the borrower pays the minimum amount, she can use the rest of the amount for business’s smooth functioning’s.

Peer-Peer loan:

Herewith the help of an online platform, you get in touch with the investors, and the borrower receives funds for her business. The peer-to-peer loan method is not essential to know the investors; the online platform functions as the third party and works as the mediator.

Short-term business loan:

These can be called stop-gap loans; they give you that small space to catch up with the market and lets you stay focused on the cash flow. Short-term loans are availed only when you are in the real crunch of money, and you know it is only a momentary thing, and you would be back to the high note of business functioning soon.

Business credit card:

Similar to the regular credit card that we use, but this is used for only business purposes. Instead of using cash to meet the expenses, you use the card to get the items and meet the business requirements.

Working capital loan:

This loan helps to analyze your firm’s daily expenses and compare them with the firm’s ability in handling finance and short-term financial performance. This method would help in making better judgments and run the firm without a cash crunch.

Microloans:

These loans are for businesses who don’t hold excellent credit scores but wish to start a business. Microloans are aimed at a small business that fails to catch the attention of great players in the market; with microloans’ help, they are given a fair chance to compete in the market.

Here are the various sources through which women entrepreneurs can gain extra funding for their business.

Women’s business centers:

Any new female entrepreneurs who feel lost and unsure where to start can take the help of Women’s Business Centers spread across various parts of the USA. They offer guidance, training, and also funds for small businesses for women.

SBA’s Women-owned business portal:

SBA is your go-to guide and helping hand when looking for someone reliable to support you. SBA helps in funding your new start-up and provides training, upscale your management skills, and guide you through the key points of running a business.

National Women Business Owners Corporation:

In case you already kick-started business and are struggling to gain a new customer database, as a new women entrepreneur, you can always take help from National Women business owners. They would help you gain potential clients’ contacts and help you place your firm in front of potential customers.

US Women’s Chamber of Commerce:

With the help of the US Women’s Chamber of Commerce, you would not gain financial support; however, you can definitely get access to various policies that should help your firm grow. Of course, not to forget, you would get access to the advocates who would help make your firm a better place to work.

Womensphere Venture Incubator:

Women in the field of science, technology, mathematics benefit a lot from this organization. The Womensphere helps to upscale your skills in the field and enables you to launch your firm’s right from scratch.

Various Grants:

Various women-centric grants that women entrepreneurs can avail of before reaching out for investors’ help. These grants would help them set their business with funds; the receiver doesn’t have to repay the amount.

These grants are provided to women who are from different backgrounds. Women entrepreneurs can also look for state grants to see if their business is eligible for the grants.

Conclusion:

Women have put in enormous effort in gaining a foothold in the field of business. With government-backed programs, women are very soon to lead the nations.

Strong management skills, incredible vision, and great energy are ready for the world with a new force.

If you are a budding woman entrepreneur and have a unique start-up plan, what are you waiting for?

Go, grab the loan that suits you and conquer the world!!!

ALSO READ: Your Complete Guide For Start-Up Business Loans For Women

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