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  • Writer's pictureCalla Norman

Best Small Business Loans for Black-Owned Businesses in 2022

Updated: Feb 8, 2022

Melissa Hirsch, owner of UnBar Cafe in Cleveland

Melissa Hirsch, owner of UnBar Cafe, was able to hire back her employees in 2020 with help from a Honeycomb small business loan!

August is National Black Business Month, but Black businesses deserve our attention and support all year round! Black-owned businesses provide their communities with vibrancy and pride, and their owners are often pillars in their communities. So, why is it so difficult for Black-owned businesses to get fair access to capital?

We’ve already got several run-downs of the best kinds of funding for small businesses - including restaurant-specific ones - but here are some unique options for Black-owned businesses of which entrepreneurs should take advantage.

Why do Black-owned businesses struggle to find funding?

Small businesses in general are still struggling with the effects of the coronavirus pandemic, and Black-owned businesses (and minority-owned businesses) have been hit the hardest. Lack of a financial safety net, forced closings in many urban areas, and unequal distribution of relief funding have all been factors in making it difficult for these businesses to stay afloat.

However, even before 2020, Black-owned businesses disproportionally had issues in finding small business loans and getting capital for their growth projects. Systemic racism, redlining, lack of generational wealth, and fear of rejection all play a role in this disparity.

Often this is a result of the dismal relationship between Black entrepreneurs and traditional financing. Black business owners are only 33% likely to have a relationship with a bank, compared to 54% of white business owners.

So, what options are there out there to help Black-owned businesses achieve fair access to capital? There are several grants, programs, loans, and mentorship opportunities out there that can help close the funding gap and get Black-owned small businesses the resources they need to succeed.

Minority Business Development Agencies

Minority Business Development Agencies are a part of the United States Chamber of Commerce that is exclusively dedicated to promoting the growth of minority-owned businesses. They work with businesses to secure funding, contracts, and access to markets.

MBDAs have secured millions of dollars in capital for minority-owned small businesses, although for the most part they are successful in select industries, such as manufacturing, wholesale trade, and services. Businesses in the food and beverage industry, the arts, retail, accommodations, and agriculture make up less than 1% of their deals combined - meaning, Main Street businesses don’t often make up much of their funding.

Even so, if you’re looking for scale on a massive level, an MBDA might be an option for you - you can check and see if there’s a local one near you here.

Community Development Financial Institutions (CDFIs)

CDFIs are institutions that aid in developing underserved communities through capital and lending. While they operate pretty similarly to a bank, becoming mega-profitable isn’t their main goal - they’re mission-driven to support development of their neighborhoods.

There are different types of funding that CDFIs partake in - banking, credit unions, loans, and venture capital. They’re a great resource for funding if you’re in an economically disadvantaged community that a traditional bank might not fund, and are often willing to finance small businesses.

Here’s a CDFI locator to find one near you!

SBA 8(a) program

The SBA 8(a) program is a business development program through a small business administration targeted toward “socially disadvantaged communities” and “economically disadvantaged individuals.” It’s not technically a loan, but it has many opportunities that otherwise might not be available to them such as:

  • Set-aside and single-source contracts with the government

  • Mentorship program

  • Management and technical assistance

This is a nine-year program, so it’s well suited for small businesses looking for long-term growth with a need for a bit of guidance and sponsorship.


Crowdfunding can be a great way for Black-owned businesses to avoid traditional financial institutions altogether and get capital from their own communities. Instead of waiting for a loan from a bank or small business administration that might take months to process and could be denied, crowdfunding offers an opportunity to unlock capital and improve relationships in your community.

Regulation crowdfunding, the kind that Honeycomb Credit specializes in, has several added benefits to merely raising the money your business needs.

First of all, the nature of debt crowdfunding means that as you get the small business loan you need to grow, you won’t be paying back some faceless bank - instead you’ll be paying back your neighbors who invested in you! So, not only will you get the capital to grow your business, but you’ll be supporting your community in the process.

Crowdfunding with Honeycomb also gives you opportunities to tell your business’s story to a wider audience, our network of Honeycomb investors, who are all passionate about giving entrepreneurs of all stripes a chance to shine. This increase in marketing buzz leads to more exposure, more Google and Yelp reviews, and a 60% on average increase in revenue.

Fair capital from local friends

At Honeycomb Credit, we believe that capital for your small business should be fairly accessible and work for both you and your community. We’ve worked with several Black-owned businesses from UnBar Cafe and Squash the Beef Vegan Catering in Cleveland to Strong’s Cleaners in Pittsburgh to support them throughout the worst of the coronavirus pandemic and beyond.

Looking for more information on small business loans? Check out Honeycomb's Ultimate Guide to Getting a Small Business Loan. You can also learn more about Honeycomb Credit crowdfunded small business loans at, and fill out the form below for more information!


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