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Mississippi has a flourishing economy, with a diverse buying market. The state hosts some attractive business loan options and grant schemes. According to Small Business Administration statistics, more than $602.2 million in loans (valued at under $100,000) was issued in Mississippi in 2019 alone. The following guide looks at some of the best loan options currently available for small businesses in Mississippi.
Best Options for Mississippi Small Business Loans, According to a Recent Analysis
Business owners in Mississippi who have been struggling to receive financial aid or loans from traditional banking schemes can turn to the Economic Adjustment Assistance Revolving Loan Fund Program. Under the program, EDA issues grants to eligible recipients to enable small businesses to expand and generate new employment opportunities.
The program has a combined investment of $560 million and has to date delivered more than 500 RLFs to businesses across the U.S. and in Mississippi as well. To date, RLF loans have leveraged over $17 billion in additional investment, allowing for the creation or retention of 690,000 jobs.
Mississippi strives to retain its diverse economy and minority-owned businesses. As such, the state has introduced the MS Minority Business Enterprise, which assists a wide range of businesses from various industries in Mississippi.
The MS Minority Business Enterprise program offers funding for minority-owned businesses, including women:
- Loan amounts can reach 50% of the total project cost or $250,000, whichever is less
- Funds can be used for fixed assets, inventory, or staff
- The loans can have a maximum of 7-year term for working capital, 10 years for equipment and machinery, and 15 years for buildings and land
- The interest rate can range from 2% below to 2% above the Federal Reserve Discount Rate
RBEG is a subdivision of the U.S. Department of Agriculture. Its aim is to assist small businesses in rural and remote areas. RBEG has a solid standing reputation for helping thousands of businesses across Mississippi. Here are some features of the program:
- There’s no maximum grant amount - the grant amount you are eligible for will vary according to your risk factor and the type of business you're looking to open.
- People can apply from any rural area.
- Loans aren't limited to larger towns, state agencies, nonprofits, etc.
- Funds are directed to businesses that find themselves in areas with less than 50,000 residents
- Incentives and extra grants are available for businesses in more populated areas.
The SBA 504 loans are some of the most trusted loans available for small businesses across America. With affordable interest rates and a focus on assisting small businesses in debt, liquidity, or simply with startup capital, 504 loans are an initiative that has helped thousands of small businesses expand in smaller and slow-growing states such as Mississippi.
Key features of the 504 loan include:
- 504 loans have a maximum loan amount of $5,000,000.
- Eligibility to apply is based on:
- Owning and operating a for-profit U.S. business
- The business has a net worth of less than $15 million
- Applicants should have a net income of less than $1 million after federal tax
- The loan can not be used for:
- Repaying debt, paying for working capital, or investment in rental real estate. These might limit some business owners, but the 504 loan scheme is still a reliable option.
This program is another federal government initiative aimed to help businesses under the 2010 Small Business Jobs Act. Mississippi received $13,168,350 from this program (of the $1.5 billion federal capital) to get small businesses off the ground and operational.
The Loan Guaranty Program made available in Mississippi provides the following eligibility criteria for small businesses:
- Employ less than 250 full-time employees and make fewer than $7,000,000 gross revenue or $1,000,000 in profit after taxes
- Minimum loan amount of $50,000
- Maximum loan amount of $500,000
- Maturity rate of 15 years
- Interest rates negotiated between Mississippi-approved financial institutions and the small business.
Additionally, the loan program clearly specifies how business owners are allowed to spend their money. Yet, in most cases, applicants can receive a loan guarantee of 50% for working capital and 80% for credit and finance fixed assets.
|Revolving Loan Fund Program||
||The funds must be used strictly for economic development purposes|
|Mississippi Minority Business Enterprise Program||
||More formal loan providers and can sometimes charge higher interest rates
There are only a select few target industries that funds are available to
||Only available to more rurally located small businesses|
|SBA 504 Loan Program||
||The maximum amount is $5 million
Limitations on profits and net income to remain compliant
||A maturity rate of 15 years can have lasting effects on small business owners|
Top Online Mississippi Small Business Loan Options
Although the loans, mentioned above, are widely available for many Mississippi-based businesses, there are several online loan options that are worth looking into.
In this section, we outline the top online Mississippi small business loan options: