Small businesses in the United States are facing unprecedented hardships and disruptions due to the novel coronavirus COVID-19. Many small businesses have been forced to close due to being an “unessential” business temporarily. Companies that are not essential are forced to downsize their workforce either by laying off employees or temporarily suspending work.
Without regular customer volume, businesses are finding it difficult to continue meeting their financial obligations, including payroll, rent, and utilities. Recognizing the suffering of small businesses and how detrimental COVID-19 is for our nation’s economy, the U.S. government and the U.S. Small Business Administration (SBA) are working together to help our nation’s small businesses.
On March 27, 2020, President Donald Trump signed the CARES Act – the Coronavirus Aid, Relief, and Economic Security Act. The CARES Act provides $376 billion for small businesses and workers. If your small business is affected by COVID-19, you can get help through the following resources:
Paycheck Protection Program (PPP)
The PPP is a loan program that helps small businesses keep their workers on the payroll. The loan will be forgiven if at least 75% of the credit goes toward employee payroll for eight weeks, rent, mortgage interest, or utilities.
EIDL Loan Advance
The EIDL loan advance allows small businesses to apply for an Economic Injury Disaster Loan advance. The advance may be up to $10,000, and will not have to be repaid. In order to qualify, businesses must show that they are experiencing a temporary loss of revenue.
SBA Express Bridge Loans
The Express Bridge Loan Pilot Program allows small businesses to access up to $25,000 quickly if they already have a relationship with an SBA Express Lender. These loans are designed to bridge the gap between average revenue and temporary loss of income.
SBA Debt Relief
Small businesses that are using SBA loans can also qualify for debt relief options through the SBA. Debt relief options include assistance with principal and interest, deferments, and loan forgiveness.
The best way to find out what your small business qualifies for is to speak with your attorney and a financial counselor. These laws are new, so it is wise to make sure you understand the requirements and terms before applying for business assistance.