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NGExpert financial copywriter
Page written by Chris Godfrey. Last reviewed on September 4, 2024. Next review due October 1, 2025.
Almost 2 million US small businesses are owned by people with disabilities and working for yourself is more popular with disabled entrepreneurs than it is for people in the general workforce. However, like most other small business owners, entrepreneurs with disabilities frequently encounter problems securing funds to launch or grow their business. This can hold them back and limit their success.
Fortunately, there’s a solution to this problem. Available from non-profits, foundations, organizations and government sources, small business grants for business owners with disabilities can help to get a startup off the ground or grow an existing business. Although qualifying rules can be strict, and the sums available may be smaller than may be found with commercial financing, business grants for disabled business owners do not need to be repaid and credit scores and other typical loan requirements usually do not apply.
Here’s a selection of grants for business owners with disabilities to start you on your search:
The Plan to Achieve Self-Support (PASS) Program is a federal program designed to ease disabled individuals into the workforce, eventually allowing them to rely less on federal supplemental security income. PASS can be used to fund a variety of expenses that disabled entrepreneurs might need to start their own business, including supplies, transportation, training fees, equipment, and more. PASS eligibility is based on income and resources. In order to qualify for this program, the disabled entrepreneur must have a net worth of less than $2,000 (or $3,000 for couples). You can join the PASS program through your local Social Security office.
Each year, the Federal Government awards about 10% of all federal contract dollars, or roughly $50 billion in contracts, to Small disadvantaged businesses. This includes organizations owned by entrepreneurs with disabilities. You can register your business as a Small Disadvantaged Business if you meet the following criteria:
See the full qualification criteria here.
Grants.gov is a one-stop directory for federal grants and the federal agencies that manage the grant funds. Inside the store you can search for business grants for individuals with disabilities from twenty-six federal grant-making agencies and more than 900 grant programs that award over $400 billion in grants per year.
The federal government aims to award at least 5% of all federal contracting dollars to SDVOSBs each year. Competition is limited for certain federal contract opportunities to businesses that participate in the SDVOSB program, an initiative administered by the US Small Business Association. Joining the SDVOSB program makes your business eligible to compete for the program’s set-aside and sole source contracts. See the full eligibility requirements here.
Disabled sole traders may be eligible for a National Association for the Self-Employed (NASE) business growth grant of up to $4,000. Since 2006, nearly $1 million has been awarded through the program, with grants used for marketing, advertising, hiring employees, expanding facilities and other specific business needs. Note that you must be a member of NASE to apply for a grant. (Membership fees may be applicable).
Business loans may provide an alternative source of funding for disabled small business owners. Online lenders will typically be the best option for this type of financing, although you may pay higher interest rates and fees than you would with traditional banks. Credit checks are standard with most commercial financing, but depending on the type of loan you choose, you may not need to provide collateral:
The most common type of commercial loan. You receive a single, lump-sum cash injection and then pay it back in regular instalments over a fixed period of up to 25 years. Collateral may be required.
This is a business loan that functions like a high-value credit card. Withdraw as much as you want when you want from a loan facility up to the limit of your borrowing. You only pay interest on the sum you withdraw, not the whole line – which can significantly reduce your borrowing costs. Collateral may be required.
Also known as account receivables financing. Borrow against the value of your unpaid invoices. The lender will usually provide up to 95% of the invoice value within a few days or even hours of the bill being raised. Your invoices act as security for the loan, no added collateral required.
Equipment loans use the asset you’re financing as security – so no added collateral is required. You use the equipment as you pay for it while the lender maintains a lien on the machinery. Once you pay the loan back, the lender releases the lien, and you own the equipment outright.
Available for businesses that accept customer payments by credit and debit card. Borrow against the value of your card sales. As your card sales increase, your borrowing limit goes up. Pay the loan back with a fixed percentage of your card sales on a daily, weekly or monthly basis. Your sales act as security for the loan, no added collateral is required.
Functions like a merchant cash advance but with higher borrowing limits. Based on the size and regularity of your total revenues, (not just your credit card sales), you may receive a lump sum and pay it back over a short-term schedule, typically by small deductions from their daily sales. This type of loan can usually be secured quickly as qualification rules are less intensive and credit scores are not so critical. No added collateral is required.
Nonprofit and community-based lenders can provide SBA Microloans to borrowers that may struggle to secure standard business financing. Available up to $50,000, these loans can be ideal for entrepreneurs who are seeking a smaller sum to start or grow their business. SBA microloans also come with more relaxed qualifying rules and can usually be secured with FICO scores as low as 500, or even with no credit score at all. Be aware that these type of business loans often require a personal guarantee that makes you personally responsible for the debt.
Working with business finance experts can make all the difference when applying for grant funding. Contact Swoop to discuss your borrowing needs, get help with your application and to compare top quality small business grants and business loans from a choice of providers. Give your business the chance it deserves. Register with Swoop today.
Written by
Chris is a freelance copywriter and content creator. He has been active in the marketing, advertising, and publishing industries for more than twenty-five years. Writing for Wells Fargo Bank, Visa, Experian, Ebay, Flywire, insurers and pension funds, his words have appeared online and in print to inform, entertain and explain the complex world of US consumer and business finance.
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