Tuesday, April 13, 2021

Minority entrepreneurs are struggling to get small business relief loans


Mr. Bancorp said many of the 1,300 paycheck protection program loans made by Southern Bancorp last year went to customers who had been sidelined by big banks.

recently Federal reserve surveyAbout 80 percent of small-business owners who are of Black or Asian descent said their companies were in shaky financial shape, compared to 54% of white-business owners. And Black owners face unique challenges. While owners of all other demographics told the Fed that their main problem at the moment was low customer demand, Black respondents cited a different top challenge: access to credit.

When Jenelle Ross, Who Runs An auto dealership In Ohio, a paycheck security program called for a loan, after his longtime bank asked him to look elsewhere – a message that big banks such as Bank of America, Citi, JP Morgan Chase and Wells Fargo. Gave many of his customers Frenzied early in the program.

Days later, he obtained a regional lender loan from Huntington Bank, but the experience was wavering.

Ms. Ross, who is black, told the House committee last year, “Historically, access to capital has been a major concern of women and minority-owned businesses, and is no different during this epidemic.”

Community lenders and aid organizations adopted a shoe-leather approach to fill the gaps.

Last year, the American Business Immigration Coalition, an advocacy group, created a “community navigator” program in collaboration with local nonprofit organizations to provide outreach workers to black, minority and rural businesses in Florida, Illinois, South Carolina and Texas Sent. He pledged through hurdles, the Whac-a-Mole-style.

Language barriers were common. Many business owners had never sought a bank loan before. Many did not have an email address and needed help to create one. Some people did not pay taxes; The coalition has hired two accountants to help people with their finances.

The group’s executive director, Rebecca Shi, said, “Our people literally went door-to-door to get people through this process.” “It’s time consuming.”



Source link

Translate ยป