It’s no secret that banks and financial institutions have been somewhat reluctant to lend to businesses operating in the hemp industry or those that plan to enter the industry. This has been a problem that hemp business owners across the board have had to deal with. While getting a loan to start a hemp business is tough enough at it is, Black-owned business owners are faced with even further challenges when it comes to getting the financial assistance they need to start and run their business.
According to reports, banks and other lending institutions are still skeptical when it comes to lending to hemp businesses, mainly because the industry is still considered relatively new. This makes it harder for banks or lenders to gauge the financial viability of giving loans to these businesses. That being said, efforts are being made at a federal level to ease the process of those who are looking for financial support in an industry that is still in its infancy.
While many efforts are being made to make it easier for hemp business owners to get easy access to business loans, there’s still a long way to go for loan products for hemp businesses to offer the same coverage and rates as traditional business options. Furthermore, these loans are usually available at a higher premium as compared to regular business loans.
To meet the growing needs of hemp businesses that are trying to secure loans, many organizations and private investors are stepping up to fill the gap, making it easier for hemp businesses to get the financial assistance they need.
Recently, The Gift, a health and wellness company based in Maryland, became the recipient of a $10,000 grant from the National Association for the Advancement of Colored People (NAACP) and a charitable organization BeyGOOD, run by global superstar singer Beyoncé. This endowment came as a surprise to the founders of The Gift, who were of course delighted. The owners also shed light on the sorry state of affairs when it comes to getting business loans for hemp entrepreneurs and business owners.
The endowment was part of a partnership agreement between the NAACP and BeyGOOD, which focused on providing financial support to Black-owned small businesses that were operating within the hemp industry. The Gift was just one of some 17,000 applications that were in the running for the grant.
Today, business owners who are operating within the hemp industry still find it difficult to obtain loans despite hemp being removed from the Schedule one substance list and being decriminalized at a federal level.
For now, The Gift has plans to utilize these newly-acquired funds to launch an ecommerce website to help grow their clientele and be able to re-launch their lineup of products using environmentally sustainable packaging. The Gift also plans to use the grant monies to kick off their own educational platform called Project 545.