Worcester Business Journal

16 Worcester Business Journal | October 20, 2025 | wbjournal.com Warehouse Storage For Rent Asset Management Program Office and Lab Moving WE KNOW STORAGE!!!! thestoragecompany.com F O C U S BANKING & FINANCE Lending to U.S. small businesses, by race Entrepreneurs who self-identify as Black or Hispanic receive a smaller percentage of U.S. Small Business Administration loans compared to the size of their respective racial groups. • SBA 7a loans Race of Percentage of Percentage of Percentage of loan applicant(s) approved loans amount received U.S. population White 42.8% 38.4% 61.6% Unanswered 27.6% 31.5% N/A Hispanic 11.3% 7.7% 18.9% Asian 11.1% 17.6% 6.0% Black or African American 6.4% 4.2% 12.4% American Indian or Alaska Native 0.8% 0.7% 2.9% • SBA 504 loans Percentage of Percentage of Percentage of Race approved loans amount received U.S. population White 54.1% 47.7% 61.6% Asian 14.6% 21.3% 6.0% Hispanic 13.7% 11.0% 18.9% Unanswered 13.5% 17.1% N/A Black or African American 3.5% 2.4% 12.4% American Indian or Alaska Native 0.6% 0.5% 2.9% Notes: U.S. Small Business Administration statistics are for fiscal 2025, as of 10/6/25. The 7a loan program gives lenders loan guaranties to support small businesses with special requirements. The 504 loan program provides long- term, fixed rate financing for major fixed assets. Census information is from 2020 census and via Wikipedia, as part of U.S. Census website is not operating, due to government shutdown. Sources: U.S. Small Business Administration and U.S. Census and supplies as she upgraded her salon and moved it to a larger location. Ever since, NCMDC has supported Clark. rough COVID, the officials there helped connect her to programs and reconfigure loans to keep her business afloat. "It was tough, scary. But not so scary because I felt as though, if anything goes wrong or something, I could always talk to them and we could always figure something out," she said. Systemic biases One of the main barriers Black and other entrepreneurs of color face when applying for business loans is distrust in the financial system due to previous unpleasant experiences stemming the industry's history of redlining, said omas-Bonnick. Seven white men came together in 1936 and made a map, commissioned by the Home Owners' Loan Corp., of Worcester neighborhoods, ranked by which should be financially invested in, based in part on the race and ethnicity makeup of the residents. eir top-ranked zone was today's Salisbury Street and Hammond Heights area, where 35.1% of the residents were non-white in 2020. eir lowest-ranked zone, today's Main South and South Worcester area, had 89.5% of its popula- tion identify as non-white in 2020. omas-Bonnick said redlining is still alive and well, even though it has improved in her nearly 30 years in the banking industry. When an entrepre- neur is looking for business financing in certain locations, she oen sees them turned away. "Before we even maybe hear the merits of what they're trying to do, we've already decided no, and I don't think it's a conscious decision," she said. A 2024 study conducted by re- searchers from Harvard and Purdue universities found business owners of color had a harder time obtaining loans from the SBA's Paycheck Protection Program launched in the initial phase of the coronavirus pandemic. e study found Black-owned restaurants are 9.1 percentage points less likely to receive PPP funding than similar white-owned restaurants. For Hispanic-owned restaurants, the difference is 5.6 per- centage points. Improving banking access Marginalized communities tend to have poor credit histories, automatically putting them at a disadvantage as credit Continued from previous page Can we create a CUSTOM magazine for you? Whether it's the celebration of a major anniversary or the opening of a new headquarters, Worcester Business Journal's Custom Publishing Division can help you create a custom magazine for your business. Our division's top flight team of writers and designers can help you tell your story – and make your business look great! Based on our unique publishing model, it's surprisingly affordable. Call WBJ Custom Corporate Project Director Christine Juetten at 508-755-8004 ext. 270. Worcester Business Journal WBJ Custom Publishing Division

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