Funding a small business can be difficult for anyone, but for Indigenous-owned businesses, it can be even more challenging.A 2022 study by the Federal Reserve Banks found that only 36% of American Indian or Alaskan Native businesses were fully approved for a loan or other financial aid resources—a whopping 22% less than businesses owned by white people. Because of this, there have been numerous funding opportunities made available to Indigenous-owned businesses over the years to close this inequitable gap.If you’re a Native business owner or are thinking of starting your own business soon, here are some resources that might help:
First Nations Development InstituteThrough First Nations, the most highly-rated American Indian nonprofit in the nation, Indigenous business owners can apply for a series of grants and financial opportunities from Native-centered organizations across the country. While the grants available and total funds awarded may vary, the organization has successfully awarded over 3,300 grants totaling nearly $80 million. The First Nations grantmaking program also offers technical resources to help Native American businesses develop.Eligible applicants for this program include:
- Native-controlled 501 (c)(3) nonprofit organizations
- Native 7871 organizations
- Federal and state recognized Tribal governments
- Fiscally sponsored Native community organizations
Community Development Financial Institutions Through many of the community development financial institutions (CDFIs) across the country, undeserved business owners can apply for special access to entrepreneurial resources, such as mentorship, trainings and small business loans. While these centers are not exclusive to Indigenous communities, many CDFIs have been labeled as ‘Native CDFIs’ for their overwhelming support of Native businesses.CDFIs offer much easier credit requirements than the typical bank business loan and also provide special opportunities for Indigenous communities through their Native Initiatives programs.
U.S. Department of Interior Indian Loan Guarantee & Insurance Program (ILGP)Funded by the Department of Interior, the Indian ILGP is a program that offers long-term loans at low interest rates to Native American business owners. Loans can be borrowed for as much as $500,000 and used for any purpose, including construction and refinancing.Applicants must be enrolled in a federally recognized Tribe, have at least 20% equity in the project being financed, run a business that is at least 51% owned by Native Americans and is considered beneficial to the Tribal area’s economy to qualify.
The NDN FundThe nonprofit organization, NDN Collective, is known for funding the passions and projects of Indigenous people, businesses and organizations. While there are many opportunities for groups and individuals alike—even for non-business-related endeavors—many Indigenous business owners utilize the Relief & Resistance loan program, which provides up to $50,000 of funding per year for two years. Grants can be used for nearly any business-related project, including construction, and additionally provides up to 15% of differing overhead and indirect costs.Those who apply for Relief & Resistance may need to provide their current business plan, budget documentation, resume and financial statements.
U.S. Department of Agriculture Business & Industry Loan Guarantee Though not specific to Native American business owners, the USDA’s Business & Industry Loan Guarantee Program has also been helpful to Native entrepreneurs. This program grants secured loans—some with terms of up to 40 years—to businesses in rural areas, including Tribal and other lands owned by Native Americans. Eligible recipients will have to provide collateral and must have their business existing in an area with fewer than 50,000 people.
Minnesota Indian Business Loan ProgramIndigenous-owned businesses based in Minnesota may eligible for the Minnesota Indian Business Loan Program. These loans are part of a state-run program for those in a Tribe within Minnesota lines. Interest rates typically range between 2% and 10%, have terms from 10 to 20 years and can be used for almost any business-related purchase except for refinancing.
Grants.gov For even more inclusive funding opportunities, make sure to check out grants.gov. The website is consistently updated with new funding opportunities, provides direct links to apply and is completely free to utilize.Read more articles for the Native Origins Community
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