Arkansas Small Business Loans & SBA Loans
The Natural State is a natural place to think about launching your small business, and fortunately, there are many business loan options in Arkansas to help you achieve your entrepreneurial dreams.
Types of Business Loans in Arkansas
Arkansas boasts the lowest cost of living out of any state in the United States, and, although its business taxes exceed those of its neighbors, the state also sports a very favorable “cost of doing business” ranking. A business loan in Arkansas can help grow your company whether you’re in an urban center like Little Rock or located out in Arkansas’ beautiful countryside. Because of these factors, small business financing offered in Arkansas tends to go further in the Natural State than in other, costlier regions.
SBA loans
SBA loans are business loans that are partially backed by the Small Business Administration (SBA), a federal agency. These loans are serviced by private lenders, but are popular because they generally have good interest rates.
Line of credit
Use a line of credit as a flexible form of financing. Unlike with a loan, this option does not involve a big disbursement upfront that you must repay, providing a flexibility that better fits many entrepreneurs’ needs.
Term loan
Term loans are common small business loans in which you would apply for a large disbursement of capital and then repays it over several years, along with fixed or variable interest.
Equipment finance
With equipment financing, you receive a piece of equipment and then pay off the cost of the equipment in installments. This way, your business can make money off the equipment immediately, even if you don’t have the funds to buy it at the sticker price.
Accounts receivable financing
Accounts receivable financing is an alternative form of business financing in which your unpaid invoices serve as collateral for a lump disbursement of funds.
Arkansas Business Loan Options
Arkansas is home to several banks and credit unions that can help small business set up shop in the state.
First Arkansas Bank & Trust offers several types of loans for whatever your business needs may be.
Arkansas Federal Credit Union specializes in small business loans, which can be helpful in the first few years of a company’s life.
Bank OZK (formerly Bank of the Ozarks) also specializes in small business loans, making navigating the SBA loan process simple.
Arkansas Capital is a nonprofit company that offers multiple loan products, including SBA 504 and SBA 7(a) loans to small businesses across the state.
LiftFund provides financing to small business owners with funds contributed by interested individuals and businesses who want to improve the economic conditions in their community by creating new businesses and jobs.
Arvest Bank offers multiple loan options to small businesses in Arkansas, including term loans, lines of credit, SBA 7(a) loans, SBA 504 loans, and more.
Southern Bancorp offers multiple loan options to small businesses in Arkansas, including various SBA loans and commercial loans.
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FAQ about Small Business Loans in Arkansas
FAQs
Thanks to such a low cost of living, owning a business in Arkansas means that each dollar from financing will go further in driving your business forward compared to more expensive areas. Remember, business loans were first and foremost created with the idea of helping small businesses reach the next rung of success. Depending on your company’s mission, that rung might be a little bit easier to reach in Arkansas.
To find the best rate, you should look at both local and national options when it comes to small business loans in Arkansas, especially depending on your location or industry. If your company works in a rural or economically depressed area, you might be able to get grants or special, low-interest business loans. If your company works in technology or science, you might also be eligible for special funding in Arkansas. Regardless, you should evaluate how each funding option will help your business grow in the long term.
Once you know how you want to structure your Arkansas business (such as a sole proprietorship or corporation), you will have to register your business with the Arkansas Secretary of State. Depending on your industry, you might need a state license in the Natural State. Once your company is official, you can start applying for loans based on how long you’ve been open, your annual revenue, and your creditworthiness. Specific qualifications and requirements will depend on the lender, so do your homework.
While you shouldn’t base your entire business plan around receiving grant funding, an impressive array of grants are available to eligible Arkansas businesses. The Central Arkansas Library System has a well-known program that can help entrepreneurs find and apply for grants. The Arkansas Early Childhood Commission offers grants to businesses focused on childcare, while the Arkansas Economic Development Commission Division of Science and Technology has options specifically for tech, applied research, and other innovative Arkansas businesses.
The Arkansas state government and local business leaders are currently very interested in growing the state economy by supporting small businesses. In recent years, the state has pushed to become an IT business hub, so many groups are looking to help tech startups thrive like Startup Junkie. Moreover, the Arkansas Economic Development Commission maintains a great list of resources available to the state’s entrepreneurs.
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