COVID-19 Small Business Administration Programs
COVID-19 Small Business Administration
Programs
To support small
businesses during the Coronavirus (COVID-19), the government has adopted
various economic relief programs. This article will cover four major programs
operated by the Small Business Administration (SBA).
The Paycheck Protection
Program (PPP)
The Paycheck Protection
Program is designed for people who run small businesses. This is an ambitious
program both in volume and conditions. Under this program, approximately $349
billion has been allocated. The small business owners who are suffering due to
the Corona pandemic will be able to recoup a portion of payroll through this
program.
Apart from small
business establishments, many non-profit organizations will be eligible for
this loan. Even tribal businesses are included in the list. This will also be an
opportunity for independent contractors and self-employed youths, provided they
fulfill all the conditions to get a loan.
This program offers the
following advantages:
- SBA will write off loans if all employees are kept on the payroll for eight weeks. The time frame for activation of the process is between February 15, 2020, and June 30, 2020.
- The amount a small business is eligible to borrow is 250% of their average monthly payroll expenses, not exceeding $10 million. The loan can be utilized for payroll, mortgage interest, rent, and other utilities.
- Under this program, one is eligible to defer loans for six months.
- The exemption offered by SBA is based on the maintenance of the employee’s salary levels. Payroll costs include employee salaries (up to annual pay of $100,000), hourly wages, and cash tips. Paid sick or medical leave and group, health insurance premiums, are also included.
For more information,
visit:
Economic Injury Disaster
Loans and Loan Advance
The SBA’s Economic
Injury Disaster Loan (EIDL) program is another initiative for small businesses.
It offers up to $2 million working capital loans to help businesses to overcome
any temporary loss of revenue. Small businesses and private non-profits organizations
in all U.S. states, Washington DC, and territories are entitled to apply for an
EIDL emergency advance of up to $10,000. Thus, it has similarities with the
PPP, as described above.
Under the EIDL, one is entitled to get the following
benefits:
The advances under EIDL
has to be treated as a working capital loan program, and it cannot be used for
the development of business, bonuses, and other expenses that are not related
to losses due to COVID-19. The beneficiaries can use the money for operational
business expenses associated with the loss of revenue from the disaster, such
as payroll, production costs, inventory, sick leave, rents or mortgages, etc.
·
Moreover, to get the
advance, the small businesses should apply for an EIDL prior to getting any
advance. The advance will not have to be paid back if the EIDL application is
rejected. You will receive the funds from the emergency advance within three
days after the prayer for the EIDL loan has been successful.
·
This program is
accessible to those businesses which were operational on January 31, 2020. The
advance can be obtainable until December 31, 2020.
·
One has to submit
information on existing collateral and details of financial records to acquire
loans over $25,000. Despite not having collateral, your application will not be
disqualified if it fulfills other conditions.
·
Some small
businesses and non-profit organizations have already received an EIDL loan
approved. Small businesses will get an interest rate of 3.75 percent. The
interest rate is 2.75 percent for non- profit organizations.
·
The funds for EIDL
loans come directly from the U.S. Treasury, not having connections with other
banks or SBA.
For more information
visit:
SBA Express Bridge Loans
Small Business
Administration has got an exclusive loan program only for SMB’s current Express
Lenders. This loan will be active during the time when the small businesses are
applying for the long-term financial support of the EIDL program.
If small businesses need
funds urgently, this is a good option for them. The small business can receive
up to $25,000.
For more information
visit:
Florida Emergency Bridge Loan
Florida Small business
Emergency Bridge Loan Program has developed a short-term interest-free working
capital loan intended to help businesses during the COVID-19. To apply for this
loan, the business must be located in any of the 67 counties in Florida. Business
must have been established and actively operating prior to March 9, 2020. The
business must be a for-profit, privately held small business that has a minimum
of two employees but no more than 100 employees.
If you are interested in applying to any of these loans,
we do encourage you to apply immediately. If you have any questions or concerns,
please give us a call; we are here to assist you.
Contact us:
Contact us:
(954) 567-1776
Visit us:
www.sotolawgroup.com
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