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Vermont best, New Mexico worst state in U.S. for Minority Entrepreneurs

Lendio on Thursday released the list of top 20 U.S. states and their ranking according to which Vermont ranked 1st followed by Wyoming, South Dakota and North Damkota. Read More

Thursday February 15, 2024 11:38 PM , ummid.com News Network

Lehi (Utah): Vermont is the best whereas New Mexico is the worst state in the United States for Minority Entrepreneurs, according to the latest ranking released by Lendio, which connects small businesses, lenders, and small business service providers through a single integrated technology platform.

Lendio on Thursday released the list of top 20 U.S. states and their ranking according to which Vermont ranked 1st followed by Wyoming, South Dakota and North Damkota on the 2nd, 3rd and 4th positions respectively.

Lendio placed Massachusetts on the 20th spot in the list whereas it ranked New Mexico, Hawaii and Alaska 47, 32 and 31 in its list of the best performing states for all racial minority groups.

According to Lendio, Vermont and Wyoming are also in the top two positions for Black or African-American.

"Vermont, with high business loan approval rates, high minority-owned startup growth, low unemployment, and lower income disparities, takes the spotlight as the number one state for minority entrepreneurship", Lendio said.

"Wyoming, South Dakota, North Dakota, New Hampshire, Montana, Maine, Utah, Kansas, Minnesota, Maryland, Idaho, Oregon, Colorado, Missouri, Nebraska, Florida, Ohio, Wisconsin, and Massachusetts also made the list", it added.

Notably, of the states with the highest absolute percentage of minority-owned businesses (Hawaii, Washington D.C., California, Georgia and Maryland), only Maryland made the top 20 list.

"The others were pushed down in the rankings due to the fact that minority business ownership rates were lower relative to the state's minority population, along with other factors analyzed", Lendio said.

Clarion Call for Policymakers

Highlighting the lending gaps experienced by the minority entrepreneurs, Brock Blake, CEO and Co-Founder of Lendio said the listing is a "clarion call" for policymakers to address the "inequality".

"Access to funding is critical to the success of a small business, but there is a lending gap experienced by minority entrepreneurs," he said.

"This disparity, where white entrepreneurs outpace their Asian, Hispanic, and Black counterparts in securing funding, is a clarion call for targeted policies and programs to bridge this inequality", he added.

According to data from the 2022 Small Business Credit Survey, 52% of white entrepreneurs are fully approved for financing, compared with 35% of Asians, 28% of Hispanics and 27% of Black applicants.

"By shedding light on these issues, we aim to spur action towards leveling the playing field for all entrepreneurs," said Brock.

"We applaud governments and organizations working to provide policies and resources that support these underserved communities and are excited by new technology advancements in loan underwriting that will make access to capital more equitable", he added.

 

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