The Small Business Administration specializes in helping small businesses find funding they need to grow, expand and run a financially healthy business. Although that funding typically includes helping businesses find loans with favorable terms for minority business owners or entrepreneurs who would otherwise not qualify for a small business loan, the SBA also helps businesses find federal grants to supplement or replace loans.
What is an SBA Grant?
The Small Business Administration does not give grants, but rather, they help business owners find grants they may qualify from other private and local organizations. The federal government does not provide business grants to for-profit businesses. The only organizations and businesses that receive federal grants are non-profits operating for charity, scientific, medical or educational purposes.
However, the SBA can help business owners come in contact with state-based and local grant programs. There are also some non-profit organizations that offer grants to business owners with certain qualifications. The grants given by these organizations are all different and the rules for determining who qualifies for them depend on the organization giving the grant. For example, business owners who need money to expand may qualify for a state-based grant, but may be required to supplement the grant with a loan or at least match part or all of the grant with personal funding.
Although it is not easy to qualify for a business grant, those who do get the money to fund their businesses do not have to repay the cash unless they fail to continue to meet the requirements dictated in the grant’s terms.
Individuals who cannot find an SBA grant do have other options. If traditional loans are not an option – perhaps due to a short credit history or a lack of established business history – the Small Business Administration can help those business owners find lenders to loan government-backed business loans. Qualifying for a government-backed business is not as difficult as qualifying for traditional financing, but there may be an approval waiting period of several months.
To apply for funding for your small business, use the form on the right to begin the application process.