The Best Small Business Loans for Women

Despite some of the inequity in funding for men and women-owned businesses, government-guaranteed SBA loans and alternative online lenders have made it easier for female business owners who can’t qualify with a bank to obtain financing.

In this guide, we’ll break down some of the best small business loans for women, as well as discuss a few alternative financing options and additional resources for female business owners.

Best for: Perhaps the best small business loans for women (or any business owner for that matter) are SBA loans. Although there aren’t SBA loans for women exclusively, SBA loans have some of the most competitive payment terms and interest rates on the market—plus, SBA loans can be used for nearly any business purpose.

Details: As a government entity, the SBA guarantees loans for small businesses; however, the SBA itself does not make these loans. Instead, banks and other direct lenders issue the loans, and the SBA subsidizes a portion of the loan if the borrower defaults.

Because of this, lenders are more likely to work with small businesses. Therefore, SBA loans for women are great financing options for those who can qualify—you’ll get low interest rates and long-term financing (seven-year terms or longer).

Plus, the SBA offers multiple programs within their suite of business loans.

• The SBA microloan program lends small amounts of money—up to $50,000—for startups and micro-businesses. 
• The SBA 7(a) loan program offers general-purpose working capital for businesses that are already a few years old. 
• SBA Community Advantage loans are part of the 7(a) program but have more flexible qualifications, potentially making them a good option for women-owned businesses. 
• The SBA 504 loan program provides money specifically for the purchase of commercial real estate or equipment.

How to qualify: To qualify for one of these loans, you’ll need to find an SBA lender—like Wells Fargo, Celtic Bank, or BayFirst—and meet a range of requirements, typically including a good credit score and a decent annual revenue. Along these lines, the process to apply for an SBA loan for women is also very involved—meaning significant paperwork and a longer time to get approved.

Women-owned businesses that can’t qualify for an SBA loan may want to look to online lenders next. Online lenders offer almost every type of business financing. There are lenders that provide short-term three- to 18-month loans for working capital, medium-term two- to five-year loans for women who can’t qualify for bank loans, and more creative arrangements like invoice financing.

Best for: If you’re looking for a longer-term loan with larger amounts, but more flexibility than an SBA loan, you might turn to Funding Circle.

Details: Funding Circle offers small business loans for women in amounts from $25,000 to $500,000 and terms up to 5 years. The interest rates on a Funding Circle loan can range from 4.99% to 15.99% and you can receive your funds within five days after applying and submitting your documents.

How to qualify: To qualify, you’ll need a minimum credit score of 660 and at least two years in business. You won’t, however, need to meet a minimum annual revenue requirement.

Overall, Funding Circle offers some of the best rates and terms of any online lender, making it a great option for women-owned businesses who can’t qualify for an SBA or bank loan. Additionally, Funding Circle will be a worthwhile lender for businesses that would prefer a simpler and faster application process compared to the lengthy processes associated with bank and SBA loans.

Although Funding Circle is a great online alternative to SBA and bank loans, they still require fairly high qualifications.

Best for: If you’re looking for more flexible qualifications, you might consider OnDeck as one of the best providers of small business loans for women.

Details: OnDeck offers both a short-term loan and a line of credit. With their short-term loan, you can receive amounts up to $250,000 with terms of up to 24 months and APRs as low as 29.9% (based on loans originated in the half-year ending March 31, 2022). Generally, a short-term loan from OnDeck will be well-suited for women-owned businesses that need access to fast funding to cover larger, unexpected purchases.

With the OnDeck line of credit, amounts range up to $100,000, with terms of 12 months and APRs as low as 29.9% (based on loans originated in the half-year ending March 31, 2022). An OnDeck line of credit is a particularly worthwhile option if you’re looking for a business loan to stabilize cash flow or cover other working capital needs.

How to qualify: To qualify for a business loan or line of credit from OnDeck, you’ll need a minimum revenue of $100,000, a credit score of 625, and at least one year in business.

If you have smaller funding needs, you may find that microloans will be the best fit.

The SBA has a microloan program, but those loans will require better qualifications and have slower funding times compared to microloans from online lenders.

Best for: Therefore, if you’re looking for a microloan, you might consider Accion Opportunity Fund as one of your top options.

Details: Accion Opportunity Fund offers microloans as small as $5,000 and as large as $100,000. Terms range from 12 to 60 months depending on the loan, and the application process takes three to five business days. Additionally, Accion Opportunity Fund primarily provides loans to underserved small business owners, including minority and women-owned businesses.

How to qualify: To qualify for a microloan from Accion Opportunity Fund, you’ll need at least one year in business and minimum annual revenue of $50,000.

On the whole, Accion Opportunity Fund is a great option for business loans for women if you don’t need a large amount of capital and can work with their loan team to find out what funding options will look like for your business.

Although debt financing (like the options we discussed above) will likely be the most accessible way for women-owned businesses to access funding, it’s not the only way. Female entrepreneurs may decide to explore alternative financing options as well, such as small business grants or equity financing.

First, a business grant is “free money” since you won’t have to pay back the cash you receive as you would a loan. However, most grants are much more restrictive than small business loans in terms of qualification requirements and what you can use the funds for. This being said, depending on your financing needs, you may still decide to consider the grants that are out there—especially since there are grants designed specifically for women-owned businesses.

To get your search started, check out our guide to the top small business grants for women.

Instead of applying for a business loan or searching for a grant, you could also look into equity financing. Equity financing is when a business owner raises money from venture capital (VC) firms and investors.

In return for capital, investors get a portion of ownership (or equity) in your business. Working with an investor can be a great option if you need a large amount of capital to start a new business or scale your business—and could use some solid business wisdom from investors along the way.

However, finding the right investor can be challenging. Here are some investors that specifically work with women-owned businesses to help you get started:

Besides business loans, grants, and investment options, other resources are available for female entrepreneurs. Some of these include:

• SBA Office of Women’s Business Ownership
• National Association of Women Business Owners
• National Women’s Business Council

These organizations provide various resources for women business owners, from training programs to networking events. For even more options, check out our ultimate guide to small business resources.