Whether you’re in search of funds to rehire staff or need working capital to get by, there are funding options out there—from forgivable loans to low-interest financing to small business grants.
Here are 6 resources you can consider if your business is experiencing the financial effect of the coronavirus pandemic.
1. Paycheck Protection Program
Enacted with the passing of the Coronavirus Aid, Relief and Economic Security (CARES) Act, the Paycheck Protection Program provides forgivable loans to businesses impacted by the coronavirus.
The goal is to help small businesses maintain or rehire employees let go due to the pandemic. Proceeds used for nonqualifying expenses will convert to low-interest-bearing loans.
Eligible small businesses could qualify for up to $10 million in funding. The program is open until June 30, 2020. However, due to a funding cap, it’s important to apply as soon as possible.
2. Economic Injury Disaster Loan
Low-interest Economic Injury Disaster Loans (EIDL) are offered through the Small Business Administration (SBA). Currently, an additional $50 billion have been designated to provide aid to U.S. small businesses and nonprofits financially impacted by the coronavirus.
Eligible companies may be able to obtain up to $2 million in working capital at a rate of 3.75% for businesses and 2.75% for non-profits with up to a 30-year term.
Loan proceeds can be used to cover costs such as payroll, accounts payable, operating expenses, fixed debt and other costs companies can’t pay as a result of the pandemic.
3. EIDL Emergency Grant
EIDL-eligible organizations can also apply for an SBA emergency grant of up to $10,000. Approved businesses will not need to repay these funds. Recently, Congress allocated another $10 billion to fund this program.
If you meet the minimum requirements to apply for an EIDL disaster loan, the emergency grant will be available to you whether or not your loan application is approved.
4. SBA Express Bridge Loans
The SBA Express Bridge Loan is a pilot program specifically designed for small businesses that have an existing relationship with an SBA Express lender. The SBA notes quick turnaround times and funding up to $25,000 per eligible business.
5. SBA Debt Relief
Additional debt relief efforts are available through the SBA. For current microloans, 504 loans and 7(a) loans, the SBA will pay the principal, interest and fees for 6 months. The SBA will also cover payments for the same loan types issued before Sept. 27, 2020. There is no need to apply for this assistance, as the SBA is automatically providing it.
Additionally, the SBA is providing automatic deferments through the year’s end for businesses with existing SBA-serviced disaster loans. If your loan was in “regular servicing” status on March 1, 2020, you qualify. Regular servicing refers to a loan that has received approval, been closed and a final disbursement has been made. If a loan is in default and has been classified in liquidation, it is no longer in the regular servicing status.
6. State and Local Assistance
Don’t overlook your state and local governments, which can also offer relief through loans and grants.
The U.S. Chamber of Commerce has a helpful tool you can use to search through programs in your area. Whether you’re in Washington, New York or somewhere in between, this site has broken down funding options in your locale.
Additionally, the site lists nationwide programs offered by several private organizations. Examples include Facebook’s Small Business Grants program and the nonprofit Kiva’s small business loan program, offering up to $15,000 in capital at 0% interest.