13 Best Small Business Grants and Resources for Felons

Updated on June 29, 2021
Advertiser Disclosure

Long after felons have paid their debt to society, most of them face challenges generating a steady income. In fact, 49% of ex-prisoners earned less than $500 in the first full year after release, according to an analysis of IRS data by the Brookings Institution, a non-partisan think tank.[1]

Further adding to the challenge is the limitations of where they can actually work. Depending on the nature of your felony, you might be disqualified from holding certain positions that involve handling money or working with children.

For many felons looking to start over, the solution is starting a business. You avoid having to pass muster with corporate hiring managers and you get to take control of your life.

But with limited financial resources, where can you get the startup money you need? Enter small business grants for felons. Grant options for felons, while limited, do exist. Keep reading for some useful resources that will help you in your quest.

13 Business Grants for Felons (Plus, Resources)

1. Your Correctional Facility

If you’re currently incarcerated, take advantage of any resources that exist inside the prison system before your release.

Many correctional facilities have programs that help inmates gain job skills that can also be useful in starting (and running) a small business. For example, you might be able to learn how to use Microsoft Office or take a culinary arts course.

2. Your Community

Programs designed specifically to help felons start businesses tend to be small and locally based. The following resources can help you find out if any programs exist near you:

  • Your state government website/offices
  • Your county government website/offices
  • Your city government website/offices
  • Local churches, temples, or other religious organizations
  • State and local economic development agencies/organizations

This is a great place to start when looking for business grants for felons.

3. HelpForFelons.org

This website focuses on general re-entry into society, not on starting a business. However, it offers a wide range of tips to help you with everything from legal information to getting education loans.

Visit this page for links to each state’s programs that assist felons with reentry.

4. Inmates to Entrepreneurs

This nonprofit community outreach group offers two free entrepreneurship courses for people with a criminal background: An eight-week course (currently taught via Zoom) and a self-paced online course.

he organization helps former inmates get the information needed to start over, start their own businesses, and become productive participants in society.

5. Federal Education Loans and Business Grants for Felons

Want to go back to school to earn accounting, graphic design, how to be an HVAC technician, or another skill that could be the foundation of a business? You might be able to get a federal Pell Grant or federal student loan to finance going back to school. Being a felon does not automatically disqualify you; financial need is the main criterion.

Learn more about federal education loans and grants.

6. Grants.gov

You can use this website to search for federal government grants you’re eligible for. Be warned, you’re not likely to find specific business grants for felons. Instead, look for grants for your type of business idea, your nationality, your heritage, or other characteristics.

Also, know there are far more grants for nonprofits than for-profit businesses, so you may want to consider starting a nonprofit.

7. SBA Microloans

In general, it’s not particularly easy to get an SBA loan for starting a business. Your best chances lie with the SBA Microloan program, which focuses on loans under $50,000—its average loan is about $13,000. The SBA does not directly make loans; it works with approved lenders and guarantees a portion of the loan.

8. Freelancer Marketplaces

Starting a low-investment business from home can be a smart move. You’ll have no worries about credit checks or signing leases. If you have the skills, consider starting a business like graphic design, freelance writing, website design, or marketing communications that lets you work with clients remotely.

Upwork, Freelancer, and Guru are three of the most popular marketplaces that match independent contractors or freelancers with clients. The websites serve as intermediaries and handle payments, so you can feel confident working with customers across the country or around the world.

9. The Federal Trade Commission (FTC)

Unfortunately, many con artists prey on desperate people who are looking for easy ways to make money from home and be their own boss. The internet is crawling with promises about making money from telemarketing, stuffing envelopes or doing medical billing from home.

Before you sign any contracts or send any money to one of these operations, be sure to visit the FTC website and read their advice on spotting scams. And keep in mind: If something sounds too good to be true, it probably is.

10. GoFundMe

GoFundMe is a personal financing site that has helped individuals raise more than $3 billion.
Just create a campaign and share it on social media. Because the site acts as the go-between, donors feel confident giving money.

Most people use GoFundMe to finance things like education, medical expenses, or charitable donations, but if you can create a convincing case for why people should finance your startup, this could be the perfect solution to getting the financing you need.

11. IndieGoGo

This crowdfunding website can help you get financing to bring new product ideas or inventions to life.  The site provides support from experts in all aspects of launching and managing your crowdfunding campaign, and can also connect you with design, prototyping, and retail partners to help take your product to market.

12. Small Business Development Centers (SBDCs)

The Association of Small Business Development Centers is a nationwide, nonprofit network that provides assistance to business owners and people who want to start businesses. In most cases, SBDCs are connected with local colleges and universities.

SBDCs provide free advice and counseling from business experts such as attorneys, accountants, and marketing professionals. They also host networking events, seminars, and webinars to help people start and grow small businesses.


With more than 300 chapters nationwide, SCORE has been helping people start and grow businesses for more than 50 years. Professionals, current entrepreneurs, and former business owners serve as SCORE mentors, giving startups and business owners free consulting and advice.

Visit the website to find the SCORE chapter nearest you or get mentoring online. The site offers a wide range of resources, including online courses, templates, articles, webinars, and more.

Article Sources:

  1. Brookings.edu. Work and opportunity before and after incarceration

(Disclosure: SCORE is a client of the author’s company.)

Rieva Lesonsky
Contributing Writer at Fundera

Rieva Lesonsky

Rieva Lesonsky is a contributing writer for Fundera. 

Rieva has over 30 years of experience covering, consulting and speaking to small businesses owners and entrepreneurs. She covers small business trends, employment, and leadership advice for the Fundera Ledger. She’s the CEO of GrowBiz Media, a media company specializing in small business and entrepreneurship. Before GrowBiz Media, Rieva was the editorial director at Entrepreneur Magazine. 

Read Full Author Bio