Samantha Williams has run her New Haven marketing agency for ten years, but when she approached her bank for a loan, she said she faced an all too common challenge.
“I asked for the line of credit, and I was denied because the bank manager said ‘I didn't think she was a good fit for it,” Williams said.
Williams is Black. She said her experiences as president and CEO of 628 Digital Design are reflected in a new report called “The State of Black Businesses in Connecticut.” The report found that access to capital remains the biggest challenge for Black business owners.
The report was issued by the Connecticut Community Outreach Revitalization Program (ConnCORP), which promotes economic redevelopment in New Haven. It surveyed approximately 300 Black business owners across the state.
Williams ended up getting a bigger loan from a different branch of the same bank. The experience, according to her, made her reflect on other challenges Black business owners face.
“We have the education, we have the guidance, we don't have the funding,” Williams said. “We are not invested at the same rate as our non black counterparts.”
The report outlines several possible solutions including greater municipal support for business owners and different loan packages tailored to their needs, including microloans.
Black business owners surveyed said support from city and town economic development offices is unclear. They said the offices do minimal outreach.
According to the report, Black people actually start businesses at higher rates compared to other ethnicities. Many people who responded to the survey stated they started their businesses with their own money, not loans, because of concerns they would face discrimination at financial institutions. Doing so, according to ConnCorp, risk their personal finances if their business fails, and slower growth rates due to not being able to access loans.
The report says many Black companies are microbusinesses, with ten employees or less. Available loan products may not be the best fit, according to ConnCorp. It recommended a microloan program for smaller businesses.
CEO and founder of ConnCAT and ConnCORP, Erik Clemons said the report shows the challenges Black business owners face. But he said it also shows what can be done to address those issues.
“This report strengthens our mission,” Clemons said.”It gives us data. It gives us clarity. It gives us direction. It allows us to move from reaction to coordinated action. This survey empowers us, and our partners, to design smarter policies, better programs, and more aligned investments.”
New Haven Mayor Justin Elicker’s office did not respond to comment. The state’s Department of Economic and Community Development also did not respond to a request for comment.
