Small businesses owned by immigrants and people of color continue to play a critical role in New England’s economy, yet securing capital remains a steep challenge.
“It’s clear that immigrant entrepreneurs are a positive force in Massachusetts and New England,” says Jim Stergios, executive director of the Pioneer Institute. “Entrepreneurship is consistently linked to higher economic growth and more opportunity.”
Despite immigrants representing just 9% of the regional population, they own nearly 14% of businesses, a clear testament to their economic impact.
But this success story masks persistent disparities. Access to conventional bank loans remains a major hurdle. Banking practices that emphasize U.S. credit history, collateral, and longstanding banking relationships often leave newcomers at a disadvantage.
“I didn’t see people who look like me,” reflects Betty Francisco, CEO of Boston Impact Initiative. “While opportunities arose, few were focused on people of color.”
Her organization is now allocating a $20 million fund, primarily directed at immigrant and minority entrepreneurs.
Language barriers also create bottlenecks. In cities like Lowell, Lynn, and Providence, strong multilingual support is lacking, and critical materials, such as loan applications, financial documents, and regulatory guidance, are often offered only in English. This forces many entrepreneurs to avoid pursuing financing out of fear or misunderstanding.
Structural inequities add further weight. A lack of generational wealth means many minority entrepreneurs lack personal savings or assets to use as collateral, pushing them to rely on high-interest credit and informal loans, conditions that stifle growth and heighten financial risk.
The COVID-19 pandemic exposed these fragilities. Many immigrant- and minority-owned firms were unable to access federal aid, such as the Paycheck Protection Program, due to weak banking relationships or insufficient documentation. As a result, numerous small businesses closed their doors permanently.
Geographic disparities also persist. Black, Latino, and immigrant neighborhoods often lack nearby bank branches or support services. Instead, residents travel long distances or turn to alternative lenders. Meanwhile, more affluent, predominantly white neighborhoods continue to receive superior access to financial and advisory resources.
Local governments and nonprofits are stepping in. Massachusetts, Connecticut, and Rhode Island are seeing expansion in microloan programs and technical assistance through Community Development Financial Institutions (CDFIs). For instance, in Massachusetts alone, CDFIs issued 12,500 loans totaling over $76 million to small and underserved businesses.
Boston’s ACEDFI, an African- and immigrant-focused CDFI, is offering loans ranging from $5,000 to $50,000, along with personalized business coaching. Yet, even these efforts struggle to meet growing demand.
Municipal support is gaining momentum. Boston’s Mayor’s Office for Immigrant Advancement recently announced a $2.1 million initiative to support community-based services, including legal aid, educational programs, and business development. Claudia Green, Executive Director of English for New Bostonians, emphasized the importance of linguistic support.
“The city is stepping up and affirming its commitment to ESOL and to immigrant communities,” she said, underscoring how vital such resources are for entrepreneurs navigating the local business environment.
Jackie Kelley, Director of Immigration Legal Services at the Rian Immigrant Center, stressed the increased need for legal assistance:
“The need for compassionate and trustworthy immigration legal services has never been greater; this is clear from the turnout at our Boston Public Library legal clinics.”
Despite these local efforts, advocates say bigger systemic changes are necessary. They urge banks to revise rigid lending criteria, expand multilingual services, and invest directly in communities of color. Policymakers are called upon to allocate more public funds to local loan programs and ensure equitable distribution to marginalized businesses.
For many immigrants and people of color in New England, entrepreneurship represents more than income; it’s a pathway to stability, independence, and community resilience. But without equal access to capital, these vital businesses will remain locked out of opportunities critical to their survival and the region’s economic vitality.
Abdullahi Hussein is a community journalist focused on uplifting immigrant voices and local stories in Boston. He is also our director of editorial and development.
