There is no doubt that the nation’s small businesses are facing an unprecedented economic disruption due to the Coronavirus. In response to this, the President signed the CARES Act, which was just the first of the many relief packages for American workers as well as small businesses.
The Small Business Administration (SBA) sets the guidelines for the loans made by the partnering with micro-lending institutions and platforms such as funders corner and other community developing organizations, making it easier for the small businesses to access loans. It doesn’t lend money directly to businesses.
The Small Business Administration (SBA) is currently offering several relief options to assist small business, faith-based organizations, as well as non-profit organizations, recover from COVID 19 impacts such as:
- Paycheck Protection Program (PPP)
This is a program that provides businesses with loans to help them keep their work force employed. The borrowers are in a position for full loan forgiveness if part of the money will be used in protecting pay checks. During the 8 to 24 weeks after receiving the loan, the loan should be spent on payroll costs and other expenses and at least 60 percent to 75 percent of the business’ proceeds should be spent on payroll.
The forgiveness is based on the employer maintaining or in other cases, rehiring employees and maintaining their salary levels.
- COVID-19 Economic Injury Disaster Loans (EIDL)
This program was signed into law on December 27, 2020, and it was part of the Economic Aid for small businesses that have been hit hard by the pandemic.
It is eligible to small business owners in all U.S. states, Washington D.C, and territories. Its purpose is to meet the operating expenses that could have been met were it not for the pandemic, and that are not covered already by a PPP loan.
Funds of up to $10,000 will now be available to those applicants who are located in low-income communities, who had previously received an EIDL Advance that was less than $10,000, or the individuals who had applied but did not receive funds.
- SBA Express Bridge Loans.
This program allows small businesses to access up to $25,000 quickly if they currently have a relationship with an SBA express lender. This money comes in handy if the business has an urgent need for cash but it is waiting for decision and disbursement on an EIDL.
- SBA Debt relief.
This program provides debt relief to existing SBA loan borrowers throughout the COVID-19 pandemic.
The SBA is now authorized to pay principal for 6 months, interest as well as any other related fees that borrowers owe for all the hard-hit small businesses and non-profit organizations.
Other than funding options funders corner provide alternative resources for business owners who are seeking capital to stay afloat or reopen during these times through the SBA resource partner network which includes: SCORE, Small Business Development Centers, Women’s Business Centers as well as Veterans Business Outreach Centers.
The SBA is committed to supporting all small business owners during these challenging times as our country emerges from this pandemic.