What Are the New Grants and Loans for Small Businesses Given by SBA Amidst COVID-19
COVID-19 took the world by surprise and the effects are truly staggering. Businesses were forced to close, some temporarily, others permanently. Individuals are required to stay home and social activities are minimized, if not completely halted. After nearly 4 months of the shutdown, businesses are beginning to recover, but many of them took severe damage and incurred debts from existing loans, higher rent payments, and other operating expenses, such as payroll and employee benefits. Businesses need to bounce back for the economy to recover as well.
The U.S. Small Business Administration is offering business loans and grants across different states and territories. These loans are low-interest, and under the request of the government officials, SBA opened business loans and grants for assistance during COVID-19. Thanks to the additional funding approved by the US Congress, the application process has opened multiple times. Here is a list of some of these loans and grants that are open for application:
Paycheck Protection Program. This is for businesses that want to keep their employees on their payroll during the effects of this pandemic. This loan will be fully forgiven if solely used for paychecks, interests on mortgages, rent, or utilities, along with other conditions that must be met. Sole proprietors, independent contractors, and self-employed individuals are qualified to apply, or any small business that meets the SBA’s size standard.
Economic Injury Disaster Loan Emergency Advance. This loan provides up to $10,000 economic relief for businesses that are largely affected by the pandemic. Agricultural businesses that involve the food industry, livestock, and all farming industries are eligible to apply for this loan. Small businesses with less than 500 employees are also eligible to apply.
SBA Express Bridge Loan. Businesses with an existing relationship with an SBA Express Lender may borrow up to $25,000. These are term loans that can be used by small businesses as they wait for approval from the SBA Economic Injury Disaster Loan (EIDL). Businesses who need a quicker turnaround can apply and can pay using the money granted by the EIDL, whether in full or partial.
SBA Debt Relief. This is a financial reprieve for small businesses greatly affected by COVID-19. SBA shoulders 6 months’ worth of principal, interest, and fees incurred by borrowers for all current and Microloans in status. This will also cover loans that were disbursed before September 27, 2020. This is separate from the Paycheck Protection Program and Economic Injury Disaster Loan, and borrowers would no longer need to apply for the two other loans.
For small business owners, check the website if you qualify for any of the business loans and grants in your state or territory. These loans can be used to cover payroll, fixed debts, or bills that are still unpaid because of economic difficulties. The interest rate for small businesses is 3.75%, and 2.75% for non-profit organizations. The government is also committed to help businesses recover and provide assistance where needed to again boost the economic growth in each city, state, and the entire country. Please visit here to learn more: https://www.newusagrants.com/small-business-loans