{"id":18847,"date":"2022-09-01T13:11:02","date_gmt":"2022-09-01T13:11:02","guid":{"rendered":"https:\/\/swoopfunding.com\/ca\/?post_type=blog&p=18847"},"modified":"2024-04-16T15:51:36","modified_gmt":"2024-04-16T15:51:36","slug":"closing-the-racial-funding-gap-identifying-the-issues-and-asking-what-can-be-done-to-put-money-in-the-hands-of-bipoc-entrepreneurs","status":"publish","type":"blog","link":"https:\/\/swoopfunding.com\/ca\/blog\/closing-the-racial-funding-gap-identifying-the-issues-and-asking-what-can-be-done-to-put-money-in-the-hands-of-bipoc-entrepreneurs\/","title":{"rendered":"Closing the racial funding gap: identifying the issues and asking what can be done to put money in the hands of BIPOC entrepreneurs"},"content":{"rendered":"\t\t
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BIPOC-founded businesses can struggle to raise the same amount of funding as their white counterparts

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BIPOC receive less business financing, less often and at higher rates:<\/strong><\/p>\n\n

According to the Federal Reserve, black, indigenous and people of color (BIPOC) entrepreneurs are at a disadvantage when it comes to accessing funding for their businesses. The figures from the Reserve are stark: 80.2 percent of white business owners receive at least some of the funding they request from a bank; by contract, just 66.4 percent of BIPOC business owners receive funding.\u00a0<\/p>\n\n

These findings are highlighted in a report by the Ontario Chamber of Commerce last year that also found small, white-owned firms received over $30,000 more than comparable companies led by BIPOC. Loans are also more expensive, with the Minority Business Development Agency announcing:<\/p>\n\n

\u201dMinority firms paid 7.8 percent [in interest] on average for loans, compared with 6.4 percent for non-minority firms.\u201d<\/em><\/p>\n\n

Daire Burke, Head of North America at Swoop says that the figures make disturbing reading:<\/strong><\/p>\n\n

\u201cOne reason why BIPOC businesses find it harder to obtain funding is that they are subject to more scrutiny than their white counterparts. We have seen a study that says BIPOC businesses are asked more often to provide financial statements, income tax returns, bank account information, personal financial asset details and credit card debt. There is also less informal help offered for tasks such as filling in loan applications which can make a big difference to approval rates.\u201d<\/p>\n\n

Will this change? Daire is confident that the needle is beginning to shift:\u00a0<\/strong><\/p>\n\n

\u201cI think things will change for BIPOC-led businesses for two reasons. First, there is a growing awareness of supporting community-based businesses in Canada and the US. More customers are prepared to spend money with local companies that are part of and feed back into the communities in which they are based. White or BIPOC, such businesses are a good bet for any lender, because they inspire confidence in their strong brand identity.\u201d<\/p>\n\n

The other reason, says Daire, is that unconscious bias may become less influential as more of the lending process becomes automated:<\/strong><\/p>\n\n

\u201cIn many cases, whether a lender lends comes down to an individual, or chain of individuals. Conscious or not, bias along that chain may impact the final decision. At Swoop, the greater part of the process is undertaken automatically and the final decision is based on purely financial factors. Even the form filling is done automatically – the system is built to be as helpful as possible.\u201d\u00a0<\/p>\n\n

Automation is possible thanks to the growth of digital-first operators in the market who make\u00a0 use of “alternative” data sources to arrive at credit decisions. These may include transaction data from ecommerce platforms, customers\u2019 purchase orders, recurring revenue and other data visible through open banking. These data points can negate some of the bias which is built into traditional financial institutions.<\/p>\n\n

Daire hopes that the Swoop approach will make a difference for BIPOC business owners:\u00a0<\/strong><\/p>\n\n

\u201cWe will need to do some work to turn the ship around. Anecdotally, I know that some BIPOC entrepreneurs anticipate that they will be rejected for a loan before they apply, so they don\u2019t even bother starting the process. The Swoop platform is built to show customers how much they can expect to borrow with an emphasis on speed and ease of use. If a business owner has been turned down for funding in the past, I\u2019d recommend that they sign up to Swoop and see what other options are available to them.\u201d


To find out more about how Swoop can help your business access funding through grants, equity and finance, sign up to our free-to-use platform here<\/a><\/em>.<\/p>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"

BIPOC-founded businesses can struggle to raise the same amount of funding as their white counterparts BIPOC receive less business financing, less often and at higher rates: According to the Federal Reserve, black, indigenous and people of color (BIPOC) entrepreneurs are at a disadvantage when it comes to accessing funding for their businesses. The figures from […]<\/p>\n","protected":false},"author":49,"featured_media":18862,"comment_status":"closed","ping_status":"closed","template":"","category":[41,59],"acf":[],"featured_image_urls":{"full":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-scaled.jpg",2560,1759,false],"thumbnail":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-150x150.jpg",150,150,true],"medium":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-300x206.jpg",300,206,true],"medium_large":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-768x528.jpg",768,528,true],"large":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-1024x704.jpg",1024,704,true],"1536x1536":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-1536x1055.jpg",1536,1055,true],"2048x2048":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-2048x1407.jpg",2048,1407,true],"image_blog":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-408x252.jpg",408,252,true],"image_podcast":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-397x298.jpg",397,298,true],"image_banking":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-29x20.jpg",29,20,true],"image_blog_internal":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-840x480.jpg",840,480,true],"image_blog_medium":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-1024x500.jpg",1024,500,true],"image_single_banking":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-80x55.jpg",80,55,true]},"post_excerpt_stackable":"

BIPOC-founded businesses can struggle to raise the same amount of funding as their white counterparts BIPOC receive less business financing, less often and at higher rates: According to the Federal Reserve, black, indigenous and people of color (BIPOC) entrepreneurs are at a disadvantage when it comes to accessing funding for their businesses. The figures from the Reserve are stark: 80.2 percent of white business owners receive at least some of the funding they request from a bank; by contract, just 66.4 percent of BIPOC business owners receive funding.\u00a0 These findings are highlighted in a report by the Ontario Chamber of…<\/p>\n","category_list":"Funding resources<\/a>, Blog<\/a>","author_info":{"name":"signe","url":"https:\/\/swoopfunding.com\/ca\/author\/signe\/"},"comments_num":"0 comments","featured_image_urls_v2":{"full":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-scaled.jpg",2560,1759,false],"thumbnail":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-150x150.jpg",150,150,true],"medium":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-300x206.jpg",300,206,true],"medium_large":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-768x528.jpg",768,528,true],"large":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-1024x704.jpg",1024,704,true],"1536x1536":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-1536x1055.jpg",1536,1055,true],"2048x2048":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-2048x1407.jpg",2048,1407,true],"image_blog":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-408x252.jpg",408,252,true],"image_podcast":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-397x298.jpg",397,298,true],"image_banking":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-29x20.jpg",29,20,true],"image_blog_internal":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-840x480.jpg",840,480,true],"image_blog_medium":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-1024x500.jpg",1024,500,true],"image_single_banking":["https:\/\/swoopfunding.com\/ca\/wp-content\/uploads\/sites\/2\/2022\/09\/2U2A8440-80x55.jpg",80,55,true]},"post_excerpt_stackable_v2":"

BIPOC-founded businesses can struggle to raise the same amount of funding as their white counterparts BIPOC receive less business financing, less often and at higher rates: According to the Federal Reserve, black, indigenous and people of color (BIPOC) entrepreneurs are at a disadvantage when it comes to accessing funding for their businesses. The figures from the Reserve are stark: 80.2 percent of white business owners receive at least some of the funding they request from a bank; by contract, just 66.4 percent of BIPOC business owners receive funding.\u00a0 These findings are highlighted in a report by the Ontario Chamber of…<\/p>\n","category_list_v2":"Funding resources<\/a>, Blog<\/a>","author_info_v2":{"name":"signe","url":"https:\/\/swoopfunding.com\/ca\/author\/signe\/"},"comments_num_v2":"0 comments","_links":{"self":[{"href":"https:\/\/swoopfunding.com\/ca\/wp-json\/wp\/v2\/blog\/18847"}],"collection":[{"href":"https:\/\/swoopfunding.com\/ca\/wp-json\/wp\/v2\/blog"}],"about":[{"href":"https:\/\/swoopfunding.com\/ca\/wp-json\/wp\/v2\/types\/blog"}],"author":[{"embeddable":true,"href":"https:\/\/swoopfunding.com\/ca\/wp-json\/wp\/v2\/users\/49"}],"replies":[{"embeddable":true,"href":"https:\/\/swoopfunding.com\/ca\/wp-json\/wp\/v2\/comments?post=18847"}],"version-history":[{"count":1,"href":"https:\/\/swoopfunding.com\/ca\/wp-json\/wp\/v2\/blog\/18847\/revisions"}],"predecessor-version":[{"id":30839,"href":"https:\/\/swoopfunding.com\/ca\/wp-json\/wp\/v2\/blog\/18847\/revisions\/30839"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/swoopfunding.com\/ca\/wp-json\/wp\/v2\/media\/18862"}],"wp:attachment":[{"href":"https:\/\/swoopfunding.com\/ca\/wp-json\/wp\/v2\/media?parent=18847"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/swoopfunding.com\/ca\/wp-json\/wp\/v2\/category?post=18847"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}