Texas small business grants and loans for 2025

What to consider before applying

If you’re beginning to explore business funding and support in Texas, here’s what to consider before you apply.

How hard is it to get a business loan in Texas?

The difficulty of securing a business loan in Texas will vary depending on credit markets and business particulars. Generally, if your business is established, has strong financials, and there’s collateral to secure the loan, it shouldn’t be difficult. If the credit markets are tight, you may have more difficulty with imperfect credit, are a start-up, or have little or no collateral.

Are there free funding programs for Texas small businesses?

Yes, but they’re limited and usually competitive. Many free funding programs prioritize businesses owned by women, veterans, minorities, or those located in economically distressed areas. These programs usually open during specific application windows, so staying informed and applying early is key.

Does Texas have a debt relief program?

Texas doesn’t have a specific state-wide debt relief program exclusively for small businesses, but it offers several initiatives and resources, including the Texas Small Business Credit Initiative (TSBCI) and Texas Micro-Business Disaster Recovery (MBDR) Loan Program. These programs won’t completely wipe out your existing debt, but they can offer helpful options like refinancing, loan guarantees, or temporary relief to make managing your business finances a little easier.

5 Texas small business grants

While small business grants can be competitive and come with specific requirements, Texas offers many grant programs to help entrepreneurs hire workers, train staff, boost innovation, and support local communities. Here are several grant opportunities available to small businesses in Texas:

1. Texas Enterprise Fund

The Texas Enterprise Fund helps businesses that are considering a new location for expansion, especially when Texas is competing with other states. Its goal is to incentivize businesses to open in Texas, requiring a minimum of 75 new full-time jobs in urban areas or 25 in rural areas. The fund offers cash grants between $1,000 to $10,000 per qualified job, based on average wages, job creation, and capital investment.

2. Skills for Small Business

If you’re a small business looking to invest in your team, the Skills for Small Business program can help. Offered by the Texas Workforce Commission, this grant covers the cost of employee training through local community or technical colleges. Businesses with fewer than 100 employees can get up to $2,000 per year for training new hires and $1,000 for current team members.

3. StartHER Grant

Run by the Center for Women Entrepreneurs at Texas Woman’s University, the StartHER Grant is all about supporting women-owned businesses in Texas. Each year, they award $5,000 to small businesses that are at least 51% woman-owned and have five or fewer full-time employees. You can use the grant for anything from buying equipment and inventory to funding a marketing campaign.

4. Young Farmer Grant Program

The Young Farmer Grant helps agricultural entrepreneurs (ages 18–45) launch or expand their businesses with matching funds ranging from $5,000 to $20,000. Whether you're starting a small farm or growing your current operation, this grant can help cover the cost of equipment, infrastructure, or other essentials to get your agricultural business off the ground.

5. State Trade Expansion Program (STEP)

The STEP program aims to increase the number of small businesses that are exporting and to increase the value of exports for those small businesses that are currently exporting. It provides financial assistance to small businesses to create or expand their export capacity.

Eligibility requirements for grants in Texas

Eligibility for small business grants in Texas can vary widely depending on the program, but most grants share some common criteria. Here are the key factors that are often considered:

• Business size: Many grants are specifically for small businesses, typically defined by annual revenue, number of employees, or both.
• Location: Some programs focus on certain areas within Texas, especially rural communities or economically underserved regions.
• Industry focus: Grants may be industry-specific, targeting sectors like agriculture, manufacturing, technology, or workforce development.
• Business ownership: Women-owned, minority-owned, and veteran-owned businesses may receive priority or be eligible for exclusive grant programs.
• Licensing and registration: Your business must be officially registered with the state and in good standing, with all required licenses and permits up to date.
• Community impact: Many grants look for businesses that will contribute positively to the local economy—through job creation, innovation, or community development.
• Operational history: Some programs require your business to have been operating for a set period (e.g., 6 months or a year) before applying.
• Matching funds: A few grant programs may ask you to match a portion of the grant with your own funds or investments.
• Documentation: Be prepared to submit items like your business plan, tax returns, financial statements, proof of good standing with the Texas Comptroller, and sometimes, specific project plans.

4 federal small business grants

Federal grants, such as the following, are also available and may be a potential funding source for your business.

1. Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) Programs

The SBIR and STTR programs support small businesses engaged in research and technological innovation. These grants provide funding to help businesses develop and commercialize new technologies in industries such as healthcare, defense, and energy. Eligible businesses must meet federal guidelines and work with government agencies like the National Science Foundation or the Department of Defense.

2. USDA Rural Business Development Grants

The U.S. Department of Agriculture (USDA) provides Rural Business Development Grants (RBDG) to help small businesses in rural communities grow and thrive. These funds support projects such as training, technical assistance, and infrastructure improvements. To qualify, businesses must operate in areas with a population of fewer than 50,000 people.

3. Minority Business Development Agency (MBDA) Grants

The MBDA, a division of the U.S. Department of Commerce, offers grants to support minority-owned businesses. These grants fund programs providing business training, access to capital, and expansion opportunities. MBDA grants are typically awarded to nonprofit organizations and business development centers that assist minority entrepreneurs.

4. Economic Injury Disaster Loans and Grants

During economic downturns and natural disasters, federal grants and low-interest loans become available through agencies like the SBA and the Federal Emergency Management Agency (FEMA).

Additional grant resources for Texas businesses

State and federal programs aren't the only places to find funding. All across Texas, small business owners can also access grants from local governments, nonprofits, and big-name companies. Here are a few places to look:

• Local government grants: Many Texas cities and counties offer their own grant programs to support small business growth, neighborhood revitalization, or infrastructure upgrades. These grants often go to businesses that are helping boost the local economy or breathe new life into a specific area.
• Private foundation grants: Some nonprofit and philanthropic organizations—e.g., Texas Women’s Foundation—provide funding to businesses that align with their mission, like supporting sustainability, increasing access to jobs, or investing in rural communities. 
• Corporate grants: Large companies often offer grants to small businesses, especially those led by women, minorities, or veterans. These programs may focus on innovation, community impact, or growth potential.

How to get a business grant in Texas: Application process

Whether you're applying for a state-sponsored program, a local initiative, or a private grant, the process can be competitive. But with the right preparation, you can boost your chances of success. Here’s a step-by-step guide to help you through the grant application process:

Applying for Texas-sponsored grants

Follow these steps to apply for state-sponsored grants:

1. Research available Texas grant opportunities

Start by exploring current funding opportunities on official sites like the Governor’s Small Business Resource Portal, Texas Workforce Commission, and Texas Economic Development. You can also check with local city and county economic development offices.

2. Make sure your business is eligible

Before diving into the application, double-check that your business meets all eligibility requirements. This usually includes being registered in Texas, in good standing with the Texas Comptroller, and having the necessary licenses or permits.

3. Gather key documentation

Most grant applications require supporting documents, such as a business plan, proof of good standing with the state, financial statements or tax returns, and details on how you’ll use the grant funds. Prepare these in advance so you’re ready when the application window opens.

4. Review the application guidelines closely

Every grant has unique requirements and goals. Read the grant guidelines carefully, paying attention to evaluation criteria, deadlines, formatting instructions, and required attachments. If the grant has a Notice of Funding Opportunity (NOFO), it will outline everything you need to know.

5. Personalize your application

Don’t just copy and paste a standard pitch. Customize your application to match the goals of the grant. Highlight how your business contributes to the local economy, creates jobs, drives innovation, or supports underserved communities.

6. Plan ahead and stick to deadlines

Give yourself plenty of time to complete the application thoroughly. Grant cycles often take weeks or even months from open to award, and late or incomplete applications are often disqualified. If you miss the deadline, add the grant to a calendar for the next round.

7. Follow up and stay organized

Once you submit your application, keep records of your submission and track your progress. Some programs may request follow-up documentation or status updates. Staying organized can also help if you apply again in the future.

Applying for federal grants

1. Identify federal funding opportunities

Search for available grants on Grants.gov and specific federal agency websites. Review eligibility criteria, funding priorities, and application deadlines.

2. Obtain a Unique Entity Identifier (UEI)

Register in the System for Award Management (SAM.gov) to obtain a UEI, which is required for federal grants. Maintain an active SAM.gov registration to stay eligible.

3. Review the Funding Opportunity Announcement (FOA)

Carefully read the FOA to understand grant objectives, requirements, and evaluation criteria. Note key deadlines and required documents.

4. Prepare the application package

Write a detailed project narrative explaining your goals, impact, and execution plan. Develop a comprehensive budget and justification for requested funding. Be sure to also gather supporting documents, such as letters of support, resumes, and compliance certifications.

5. Submit your application

Use the designated platform to submit your application. For federal grants, this is typically Grants.gov. Ensure all components are properly formatted and submitted before the deadline.

6. Follow up and await feedback

Monitor your application status through the submission portal. Respond promptly to any requests for additional information or clarifications.

Applying for local, private, or corporate grants

1. Find grant opportunities

Check local government websites, private foundations, and corporate grant programs for available funding. Review eligibility and application requirements.

2. Prepare required documents 

Gather business details, financial statements, and a strong proposal outlining your project, goals, and impact.

3. Submit your application 

Follow the specific submission process for each grant, ensuring all required documents are included.

4. Monitor and follow up 

Track your application status and respond to any follow-up requests for additional information.

4 Texas small business loans

If you’re a small business owner in Texas looking for funding, loans can be a reliable way to get the capital you need—whether you're launching something new, growing your operations, or going through a rough patch. Here are some loan options available in Texas:

1. Texas Capital Access Program (CAP)

CAP is designed to help small and midsize businesses that might struggle to get approved for a traditional loan. It works through a partnership between the state and nonprofit lenders. Together, they create a special reserve fund that helps reduce the risk for lenders, so more businesses can get the funding they need. To qualify, your business must be based in Texas (or have at least 51% of your employees here) and have fewer than 500 employees. You can use loan funds for working capital or to buy, build, or lease assets like equipment or property.

2. Texas Loan Guarantee Program (LGP)

The LGP gives small businesses a boost by guaranteeing up to 80% of a loan’s principal. This makes lenders more willing to approve businesses that may not meet standard loan requirements. If you’re planning to expand, renovate your space, or hire new employees, this program can help reduce financing hurdles. Your business must be located in Texas and primarily operate here to be eligible.

3. Product Development and Small Business Incubator Fund (PDSBI)

The PDSBI offers long-term, low-interest loans to innovative companies and business incubators across Texas. It’s designed to support the creation and growth of new products, technologies, or startups that bring jobs and innovation to the state. Loan amounts typically range from $1 million to $5 million, with terms up to 15 years for working capital and up to 20 years for real estate. To apply, your business needs to be based in Texas and have at least three years of operating history.

4. SBA 7(a) Loan Program

In addition to state-sponsored loan programs, the SBA 7(a) Loan Program is a federally backed option that offers Texas small businesses funding for working capital, equipment, real estate, and debt refinancing. Loans are issued through banks, credit unions, and alternative lenders, with the U.S. Small Business Administration guaranteeing a portion of the loan to reduce lender risk. Eligibility typically requires strong credit, sufficient revenue, and a solid business plan.

Texas small business loan eligibility

To qualify for small business loan programs in Texas, your business will typically need to meet a few key criteria:

• Business size: Most programs are open to businesses with fewer than 500 employees.
• Location: Your business must be located in Texas or have at least 51% of its employees based in the state.
• Good standing: Your business should be registered with the state, have up-to-date licenses, and be free of major legal or financial issues like recent bankruptcies or tax liens.

Your business must also meet any other requirements specified by the lender.

Do you have to pay back loans in Texas as a small business?

Yes, small business loans in Texas have to be repaid, usually with interest. Repayment terms vary depending on the lender and the type of loan, so it’s important to review the details carefully. Factors like interest rates, loan length, fees, and any penalties for early or late payments can significantly affect your total cost. Talk with a financial advisor or accountant who can help you choose the best loan for your business and manage repayment effectively.

How to get a business loan in Texas: Application process

Getting a small business loan in Texas involves planning, paperwork, and choosing the right lender. Whether you're applying through a traditional bank, credit union, or state-supported program like CAP or LGP, following a clear process can boost your chances of approval. Here’s how to get started:

1. Assess your funding needs

Figure out how much money your business needs, what you’ll use it for (equipment, payroll, expansion, etc.), and which type of loan—SBA, CAP, LGP, or conventional—best fits your goals.

2. Review your credit and financials

Lenders will look at both your business and personal credit scores, cash flow, and revenue history. Make sure your financial documents are in order and check for any red flags that could affect your approval.

3. Create a strong business plan

Many lenders—especially SBA and state-backed programs—require a detailed business plan. Include your company overview, market research, financial projections, and how you plan to repay the loan.

4. Compare lenders and loan programs

Shop around. Large banks may rely heavily on credit scores and automation, while smaller banks, nonprofits, or community lenders may take a more personal approach. If you’re applying for a CAP or LGP loan, look for lenders that participate in those programs.

5. Gather required documentation

Every lender has slightly different requirements, but you’ll typically need:

• A completed loan application
• Business and personal credit reports
• Financial statements and tax returns
• Proof of revenue and cash flow
• Business licenses and permits
• A certificate of good standing from the Texas Comptroller
• Proof of insurance and, if required, collateral documentation

6. Submit your application

Once everything’s in order, submit your loan application through the lender’s preferred process—online, in person, or through a loan officer. Double-check for accuracy and include all required materials.

7. Wait for review and funding

Lenders will review your application, evaluate risk, and may request additional documents before making a decision. If approved, you’ll receive the terms and disbursement details, and then funding will follow shortly after.

Texas small business funding resources and support

Texas offers many programs, nonprofits, and mentorship opportunities to help small business owners succeed—especially those facing challenges accessing traditional capital. Here are a few key resources to explore:

BCL of Texas

BCL (Business & Community Lenders) of Texas offers flexible loan programs, business coaching, and economic development support to small businesses across the state. They focus on helping underserved entrepreneurs—particularly those in rural communities or low-to-moderate income areas—access capital and technical assistance.

LiftFund

LiftFund is a nonprofit lender that provides small business loans and training to entrepreneurs who may not qualify for traditional bank loans. They offer funding options for startups, women-owned businesses, and minority-owned businesses, as well as business education and support programs.

PeopleFund

PeopleFund supports small business owners through affordable loans, education, and mentorship programs. Their services are tailored for women, veterans, people of color, and low-income business owners. In addition to lending, they offer one-on-one coaching, financial literacy workshops, and access to business resources.

Texas Small Business Development Centers (SBDCs)

Texas SBDCs provide free business advising and low-cost training to entrepreneurs throughout the state. Local SBDC advisors can help guide you through every stage of your business journey, from writing a business plan to refining your marketing strategy.

Other ways to fund your small business in Texas

Grants and loans are common funding options for businesses, but they aren’t the only ways to secure financial support. Texas small businesses can explore a variety of alternative funding methods to fuel growth and operations. Here’s a look at some of the most popular options:

Alternative loans

Non-traditional financing options such as online lenders, peer-to-peer lending, or merchant cash advances, often with more flexible requirements than bank loans.

Angel investors

Established entrepreneurs (angel investors) who invest their personal money into startups, often at an early stage, in exchange for equity.

Bootstrapping 

Using personal savings and revenues to fund business operations without external financing.

Contests

Competitions where businesses pitch ideas to win funding or resources.

Corporate programs

Initiatives by large companies offering funding, mentorship, or resources to small businesses.

Crowdfunding 

Raising small amounts of money from a large number of people, typically via online platforms.

Friends and family 

Obtaining funds from personal networks to support business ventures.

Incubators 

Organizations that support startups with resources, mentorship, and sometimes funding.

Microloans

Small, short-term loans from nonprofit lenders, government programs, or alternative lenders, often designed for startups and businesses that may not qualify for traditional bank loans.

Product presales

Selling products before they are produced to generate upfront capital.

Purchase order financing

Obtaining funding based on purchase orders to pay suppliers and fulfill customer orders.

Vendor financing

Suppliers provide goods or services with deferred payment terms to support business cash flow.

Venture capitalists 

Professional firms that invest in startups with high growth potential in exchange for equity.

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