More than 1.8 million U.S. businesses are owned by people with disabilities and a higher percentage of working-age people with disabilities rely on self-employment compared with working-age people without disabilities, according to a National Disability Institute report published in April 2022.
Starting and running a business can require significant capital, and finding business loans and grants can be challenging for any entrepreneur, including people with disabilities and other members of underserved communities who often face barriers to financing[0].
However, there are business funding options as well as other resources for people with disabilities.
We’ll start with a brief questionnaire to better understand the unique needs of your business.
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Business loan options for people with disabilities
Here are some of the best business loans for people with disabilities including options for startups and those with bad credit.
Best for: Business owners with disabilities who have good credit but can’t qualify for a bank loan.
The Small Business Administration (SBA) doesn’t issue loans, but instead guarantees loans made by participating lenders. The SBA 7(a) loan is the SBA’s most popular offering, providing up to $5 million in funding and repayment terms of up to 25 years. This loan can be used to start a new business, expand an existing business, buy commercial real estate, invest in new equipment and much more.
Since 7(a) loans, like other SBA loans, are backed by the federal government, lenders are more willing to work with small-business owners, including those who may not have qualified for traditional bank loans. However, businesses that have been established for a couple of years, are producing revenue and have good credit are more likely to qualify for SBA financing.
Best for: Service-disabled veterans, or those who need less than $500,000 in financing.
The SBA Express loan program is part of the 7(a) program and offers expedited financing for loans under $500,000.
SBA Express loans can be a good option for service-disabled veterans, as the upfront fee is waived for veteran-owned businesses. Even if you’re not an eligible veteran, SBA loans offer low interest rates and long repayment terms.
Best for: Entrepreneurs with disabilities who need startup financing.
SBA microloans offer up to $50,000 in funding, with an average loan amount of $16,789 in the 2024 fiscal year[0]. These loans can be used for a variety of purposes, such as working capital, inventory, equipment, hiring staff and remodeling your work space. They can’t be used to pay existing debts or purchase real estate. SBA microloans are issued via nonprofits, many of which have a mission to help underserved groups, including disabled entrepreneurs.
The SBA sets maximum interest rates that nonprofits lenders can charge on microloans, and the repayment term goes up to six years.
Compared to 7(a) loans, SBA microloans are a little easier to qualify for. Lenders often place more emphasis on your anticipated income during the term of the loan. Newer businesses can qualify as well, as long as the owner is in a good position to pay back the loan.
Best for: Rural business owners with disabilities.
U.S. Department of Agriculture loans are focused on helping rural businesses and can be another option for entrepreneurs with disabilities. Like the SBA, the USDA doesn’t provide business loans directly. The agency guarantees loans made by private lenders and provides funding to intermediary agencies.
There are several USDA business loan programs including the Business and Industry Loan Guarantee Program. Through this program, the USDA partially guarantees loans — up to 80% in the 2024 fiscal year — made by lenders to businesses within rural areas. The USDA defines a rural area as a place with fewer than 50,000 residents.
Borrowers typically need good credit and sufficient business revenue to qualify for USDA business loans and some may require collateral.
Best for: Individuals with disabilities operating businesses in low-income communities.
CDFIs receive Disability Funds-Financial Assistance (DF-FA) awards from their governing agency within the U.S. Treasury Department to fund projects to help individuals with disabilities. These funds are used by CDFIs to support a variety of projects including small-business loans for entrepreneurs with disabilities.
Underwriting requirements at CDFIs can be more flexible than banks. For example, Accion is a CDFI that lends to small businesses, providing loans to a diverse set of entrepreneurs, including those with disabilities.
Best for: Business owners with disabilities who have very good to excellent credit, several years in business and strong revenue.
Although you won’t typically find bank loans designated specifically for people with disabilities, bank loans generally offer the lowest rates and best terms as compared with other types of business financing. You’ll typically need good credit and multiple years in business to qualify. There are some large banks, like Chase, that work with the National Disability Institute to support entrepreneurs with disabilities through business resource centers, executive coaching and education.
Best for: People with disabilities who have bad credit or who need quick funding.
A variety of short-term business loans are offered by online lenders. Although not specially designed for entrepreneurs with disabilities, these loans typically offer a quick and easy application process. While these loans can be easier to qualify for, they also typically have higher interest rates and shorter loan terms. Some of these lenders offer startup business loans and bad credit business loans.
Best for: Business owners with disabilities involved in community-based projects.
In addition to the federal government, some states offer loan programs to assist underserved communities that face barriers to business financing. Funding may require job creation or retention or other economic activities in the community. For example, Illinois has a loan program called Advantage Illinois that targets businesses owned by people with disabilities, women, minority entrepreneurs and veterans. The New York State Small Business Revolving Loan Fund program offers short-term business financing to “socially and economically disadvantaged individuals,” including disabled veterans-owned businesses and others.
Business grants for people with disabilities
Business grants, which typically don’t require repayment, can be another way to access capital for a small business. However, grants are highly competitive and grant agencies typically receive many applications for a small number of awards. Having a compelling story to share can be helpful.
Government agencies, nonprofits and private companies all provide small-business grants. A few are targeted specifically to entrepreneurs with disabilities, but in most cases you’ll be competing for awards against broader groups of business owners.
Grants.gov
Grants.gov is the biggest repository of federal government grants and is a great place to check for grants. The website is designed to work with assistive technologies, such as screen readers, to provide access to individuals with disabilities. In addition to searching for federal grants, the website also provides a learning center that explains the basics of grants and much more.
Transform Business Grants
The Transform Business Grant offers funding to support entrepreneurs in marginalized groups including individuals with disabilities, BIPOC individuals, formerly incarcerated individuals and LGBTQ+ individuals. Grant recipients receive $1,000 to invest in their business or business idea and also participate in a yearlong mentorship program. Applications are accepted March 15-31 (reviewed in April and May) and Sept. 15-30 (reviewed in October and November).
NASE Growth Grants
The National Association for Self-Employed offers $4,000 grants to small-business owners. Applications are accepted throughout the year and reviewed in January, April, July and October. You need to be a member of the organization to apply.
Grant Watch
Grant Watch is a listing directory for grants that can be searched for small-business grants that are available to individuals with disabilities on a national or state level. You are required to pay a subscription fee to access the information.
NAACP and Leslie’s Certification Boost Grant
The NAACP and Leslie’s Certification Boost Grant help entrepreneurs operating in rural and urban communities get business certifications, including Disability-Owned Business Enterprise (DOBE). The most recent funding round awarded $5,000 grants to small businesses in Arizona, California, Florida, Georgia and Texas. Applications are currently closed.
Restaurant Business Development Grant Program
The nonprofit Feed the Soul Foundation offers grant awards of $10,000 to culinary businesses that are 51% owned by a person who identifies as marginalized, including those with physical disabilities. Winners of the Restaurant Business Development Grant Program receive six months of consultations and educational services in addition to the financial stipend. Applications for the grant are accepted Oct. 5, 2024, to Jan. 31, 2025.
Beyond Open grants
Beyond Open grants provide funding for a diverse community of small-business owners including individuals with disabilities, as well as minority, women, veteran and LGBTQ+ entrepreneurs. To be eligible, the business must be located in the area of Charlotte, North Carolina. This grant program is divided into three rounds. Around 175 grants were awarded in the previous two rounds with amounts ranging from $5,000 to $250,000. Round three of this grant program opens in 2024.
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How to get certificated as a disability-owned business
Getting your business certified as being owned by a person with a disability may help in the pursuit of funding and also open opportunities to pursue government contracts. Certifications are available through the SBA, state governments and nonprofits
Typically, to receive certification, the business will need to be at least 51% owned and controlled by a person with a disability.
Small Disadvantaged Business Certification
This certification, which is offered by the SBA, is designed for businesses owned by socially or economically disadvantaged persons, including individuals with disabilities. Businesses must also meet SBA size standards. Eligible businesses can get certified through SAM.gov.
Service-Disabled Veteran-Owned Small Business Certification
Disability-Owned Business Enterprise
Disability:IN is a nonprofit that offers certification as a disability-owned business enterprise. Getting DOBE certified can help you compete for state contracts. Colorado and New York are examples of states that encourage certification of members of the disability community who own businesses when applying for state contracts.
Disability:IN also offers certifications for businesses owned by veterans with disabilities.
Business resources for people with disabilities
In addition to loans and grants, there are a variety of business resources for people with disabilities. Some of these resources focus on financial assistance, and others provide networking opportunities, training, and mentorship.
The National Disability Institute is a nonprofit that advocates for people with disabilities and also provides training and technical assistance to the community. The NDI’s Small Business Hub, supported by the SBA, can help you write a business plan, find capital and provide one-on-one counseling to support your business goals.
The Job Accommodation Network entrepreneurship hub focuses on self-employment and small-business development and offers mentoring, consulting services and technical assistance to individuals with disabilities. JAN is supported by the Office of Disability Employment Policy under the U.S. Department of Labor.
Center on Self-Employment is designed to support people with disabilities in achieving self-employment, business ownership and other goals. You’ll find resource listings for each state that include loan and grant funding opportunities such as Florida’s trade show grant that would reimburse 75% of trade show booth costs, up to $5,000.
The Social Security Administration’s (SSA) PASS Program is a federal program designed to help disabled individuals become more financially independent. It’s open to individuals who receive or are eligible to receive SSI or SSDI. Under PASS, you can set aside money from your monthly SSI or SSDI check to reach a stated goal, such as starting a business. In some cases, you may receive more money in your monthly check to offset contributions.
SBA resource partners such as Small Business Development Centers and SCORE can provide free and low-cost entrepreneurial training, counseling and business mentoring. These organizations work with startups and existing businesses and have offices located throughout the U.S.
Disability:IN is a nonprofit that acts as a resource for individuals with disabilities. In addition to offering certifications, it offers information on digital accessibility programs, disability inclusion, disability equality index and other topics.
A version of this article originally appeared on Fundera, a subsidiary of NerdWallet.
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