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BizFilings Suggests Women Entrepreneurs Attain Funding from Financial Institutions, Not Credit Cards

Recent Survey Findings Show that Women Entrepreneurs are More Likely to Make Risky Choice and Fund Businesses with Credit

MADISON, Wis. (August 30, 2011)

According to a recent survey by PNC Financial Services, women entrepreneurs are rapidly growing in number, but also are making risky choices when financing their businesses. BizFilings, a leader in online incorporation, suggests possible funding solutions for business owners looking to put their businesses on track to a successful financial future.

The recent PNC Financial Services survey found that women business owners are increasingly reliant on credit cards as a main source of funding for their businesses, with 59 percent of women using business credit cards to fund their businesses, and 34 percent using personal credit cards. Additionally, almost half (44 percent) of women business owners are reliant on family or personal savings for business funding. While women business owners use an average of 2.7 sources of funding for their businesses, only a quarter of women (26 percent) are using a business loan from a financial institution to fund their small businesses. Relying on cards, rather than fixed-rate loans, can leave businesses with unexpected and expensive debt.

As women-owned businesses have grown by 44 percent over the past ten years, this means more women business owners than ever are making dangerous financial decisions. Using credit cards as a main source of funding doesn’t account for any negative downturn in business or provide a safety net for a possible crisis. In addition, if credit card payments aren’t made, the business owner’s personal credit ratings could fall, and other future plans for the owners’ personal life, such as obtaining a mortgage or car loan, may suffer.

While bank loans are a more stable and traditional source of funding, women business owners are less likely than male small-business owners to take out a business loan. Though it may appear to be a daunting task to ask for a loan, taking the step to incorporate a business may make the loan approval process easier. Financial institutions are more likely to provide loans to companies that show commitment and credibility — and often, incorporating a business provides that legitimacy.

To find financial institutions that provide loans to small businesses, visit the Small Business Administration’s website ( The SBA also offers specific programs and assistance to help women entrepreneurs receive funding and support for their small businesses.

“Women business owners are growing rapidly in numbers and overall success, but their increased reliance on alternative sources of funding isn’t a great long-term strategy,” says Karen Kobelski, a member of the leadership team at BizFilings. “Incorporating can increase the credibility of your business, and may also help your chances of getting a bank loan.”

Starting a small business also comes with financial risks, but those risks don’t need to cross over into the business owner’s personal or family life. Incorporating a small business can also provide protection for a business owner’s personal assets. When a business is incorporated, the business owner is often not personally responsible for the company’s debts or liabilities. This can establish an important legal separation between personal assets, such as a home, vehicle or personal savings, and business debts. Moreover, incorporation offers additional benefits for small businesses, such as increased tax breaks.

For more information about incorporating a business, visit the BizFilings online learning center.

About BizFilings

BizFilings is a full-service, online incorporation service provider, offering small-business owners a fast, easy and economical way to form a corporation, limited liability company (LLC) or other business structure online or by phone. BizFilings also offers a full range of business filing and compliance products, including nationwide Registered Agent Service, helping keep businesses in compliance with state regulations. BizFilings can be found online at BizFilings is a part of Wolters Kluwer,, a leading global information services and publishing company. Wolters Kluwer, with 2010 annual revenues of €3.6 billion, employs approximately 19,000 people worldwide, and maintains operations in over 40 countries across Europe, North America, Asia Pacific and Latin America.