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Written by Bria Overs | Word in Black
(WIB) – Access to capital – that’s the biggest hurdle for Black-owned businesses. Now, a new partnership between USBC and Lendistry may just be a tool to help underserved entrepreneurs.
The new initiative, a lending portal, will provide minority-, women- and veteran-owned small businesses with access to capital “tailored specifically to meet their needs and goals.”
“We know that our communities typically lack financial institutions,” USBC President and CEO Ron Buzbee Sr. said. “That’s why this platform is so great. No matter where you are in the country, you can now use this portal to apply for the funding you need.”
Founded in 2009, USBC is an advocacy nonprofit that supports African American chambers of commerce and business organizations across the country. We focus on economic empowerment and the development and growth of Black-owned businesses.
“We are trying to address a number of challenges and remove barriers for businesses to continue to grow and pay a fair amount for the capital they need,” Buzbee said.
Founded by Everett K. Sands, Lendistry is the first Black-led community development financial institution (CDFI) and national small business financial institution of its kind. They provide economic opportunity, financing, and financial education to small business owners and underserved communities.
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“I think one of the benefits of this partnership is that business owners can connect with local U.S. Black Chamber groups and get some technical assistance, business, advice, etc.,” Sands said. Masu. Additionally, entrepreneurs can use this portal and her Lendistry to find ways to raise funds for their needs, including working capital, debt consolidation, business acquisitions, business expansion, and commercial real estate.
According to USBC, the portal allows business owners to:
- Accelerate access to funds in as little as 5 days
- Loans available from $25,000 to $5,000,000 with loan terms up to 10 years
- get competitive interest rates
To qualify, you must:
- Be in business for at least 2 years
- Be a for-profit, nonprofit, sole proprietorship, C-corp, S-corp, partnership, or LLC
- Submit financial report
According to the Federal Reserve’s 2023 Report on Emerging Businesses Owned by People of Color, business owners of color rely heavily on personal savings or receive funding from family and friends. It is reported that it has been obtained. 28% of businesses with employees said they received funding from a financial institution or lender. Among white-owned startups with employees, 48% received funding from financial institutions.
Related: Challenges beyond finance lead to black companies going out of business
The 2022 Small Business Credit Survey showed that newer businesses are more likely than older businesses to feel discouraged about borrowing, the report said. The report explains: “They didn’t apply because they didn’t think they’d be approved. Lenders often have revenue standards, collateral requirements, or expect several years’ worth of financial statements that startups often can’t provide. there is.”
“There is a recognized risk that people of color, especially Black people, who own small businesses may not pay their bills or are not good candidates for financing,” Sands said. “The more Lendistry can uncover data, information, and what happened, the more capital our community will have access to.”
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