Across the country, an increasing number of women are launching small businesses. That’s the good news.
The tragic news, is that many of these competent, creative and hard working women will run into the lending marketplace’s version of the glass ceiling: a rejected small business loan application. Banks are notrious for low approval rates for loan applications.
To begin with, both men and women are facing unprecedented obstacles to getting a small business loan from their bank. This is because banks have become extremely risk adverse since the Great Recession, and also because it costs banks about the same amount of money to underwrite a $25,000 loan as it does a $2 million loan.
Would it be ethical and appropriate for banks to feel a sense of obligation and loyalty to their small business clients? Yes. Do they lose sleep over this? Not a wink; especially because they can impose extremely high small business loan application criteria, which keeps them from looking like “the bad guy” when the application is denied.
However, while as noted this anti-small business loan sentiment is something that both men and women experience each day, the fact is that women typically face an even higher, tougher hill to climb. This is because when evaluating loan applications, banks put an immense amount of weight on credit score, credit length, and collateral – and many women don’t have all three of these going for them.
This isn’t because they’re risky borrowers or “not credit worthy”. It’s because historically, many women haven’t been the primary breadwinner in their household. As such, even though they may have – and often DO have – an immense amount of financial acumen, discipline and judgment, their abilities don’t map to the “checklist” that banks use.
Again, banks feel no urge or responsibility at all to revisit their checklist. If that ever happens, it bodes well for the children and grandchildren of today’s applicants. But it doesn’t change the fact that right now thousands of women will not get the cash they need to do what governments, cities and communities are virtually begging them to do: launch a small business!
Alternative Business Funding: Mulligan Funding
At Mulligan Funding, we proudly invite women entrepreneurs and business owners to contact us and inquire about our small business loans for women. Our alternative business funding approach allows for approval rates that are much higher than banks. And we do not require great credit, a lengthy credit history, or collateral of any kind.
When you elevate your small or mid-sized business to the next level, you not only generate essential economic activity in your communities and create great jobs, but you inspire other women to follow your lead. And there’s no way anyone can put a price on that!
Call Mulligan Funding at 855-326-3564 to discuss your financing options today!