As today's economy continues to change, more and more women are moving into entrepreneurship. When it comes to your own small business dreams, financing is a key consideration. It's possible to start a successful small business just with cash on hand, but it's not always the fastest (or safest) way to grow a business, especially given the availability of small business loans for women.
Whether you're starting something from the ground up, or you need a flush of capital for your next "big thing," getting a small business loan could be the best move for you.
Government Small Business Loans
As you think about the financial needs of your business, consider your business loan options carefully. One of the first destinations for anyone considering a small business loan is the Small Business Administration. You should know, however, that the SBA itself is not a lender. It guarantees small business loans, but these loans are coming from other lenders (both traditional and nontraditional). They can also help you determine which type of SBA loan you need for your small business.
While there aren't specific SBA loans for women, there's an arm of the SBA just for women. This resource offers guidance for women entrepreneurs who are launching and growing their businesses, and it includes information on the SBA's loan programs (which are available to any qualifying small business) and how to decide which one is right for you.
Traditional Business Loans for Women
Generally speaking, banks and loans go hand in hand. Banks and credit unions are the go-to resource for many kinds of financing, small business loans included.
There are advantages to traditional business loans. Banks often have different loan options, some of which are designated solely for women. Banks are also accessible and convenient, offering a bricks-and-mortar place where you can get to know the staff and receive personalized, one-on-one support. Many also offer low interest rates when compared to financing sources like credit cards, and there's also a built-in tax break.
One specific benefit of bank loans over angel investors and venture capitalists is that banks don't require ownership, portions of the profits, or the right to decision-making. Your responsibilities to the bank end when your loan is paid off.
Nontraditional Business Loans for Women
Traditional banks are a mainstay in business loans, and that's not changing anytime soon. But they aren't the only business loan option, either.
If you're interested in a non-traditional small business loan, consider an online lender like LendingClub or OnDeck, both of which offer loan programs similar to what you'll find in a traditional bank, but with loans that may be easier to get. Online lending hubs like Lendio bring together lists of all available financing options, including traditional loans as well as nontraditional loans.
Another innovative way of securing a small business loan is crowdfunding. Crowdfunding models range from rewards in exchange for rewards (think Kickstarter), to peer-to-peer lending (including Prosper and LendingClub) to micro-financing (like Kiva).
Final Thoughts on Small Business Loans for Women
Small business loans for women are becoming more and more accessible, with both traditional and non-traditional funding sources. Take advantage of valuable resources like the Small Business Administration to find the right small business funding options for your business, and don't be afraid to consider non-traditional financing.