The COVID-19 pandemic has had devastating impacts on the economy, and small businesses are among the entities suffering the most. However, there are relief options out there.
For example, the Small Business Administration (SBA) offered a Paycheck Protection Program to help small businesses continue to pay their employees during the pandemic. That program closed on August 8, however, there are many other relief options for small businesses still available.
Here are six of them.
1. Economic Injury Disaster Loans
The SBA also offers an Economic Injury Disaster Loan (EIDL) to cover expenses associated with working capital and normal operating costs. It provides a 3.75% interest rate to small businesses. Moreover, they get an automatic one-year delay before monthly payment requirements begin.
Candidates must not have more than 500 employees. Applying happens online through a dedicated portal. However, it is not a short process. Instructions provided at the start of the application clarify that the estimated time for completing the application is 130 minutes. People may discover as they go through each section, though, that not all portions concern their business.
2. SBA Express Bridge Loans
This option — also from the Small Business Administration — helps parties quickly access up to $25,000 through an SBA Express lender. This option can be a term loan or tide a business owner over while they wait for a decision on an EIDL. Also, people can pay back this loan in full or part through EIDL.
The approval process for these loans continues through March 13, 2021. Before the coronavirus crisis, the SBA had a pilot version of this program for events leading to presidential disaster declarations. It then extended this offering due to the emergency circumstances caused by COVID-19. Qualifying businesses must have been operational when U.S. leadership deemed the coronavirus a national emergency and prove that the pandemic adversely affected their companies.
3. GoFundMe’s Small Business Relief Fund
GoFundMe became a popular platform for small-business owners and concerned citizens to reduce COVID-19’s financial impact. The crowdfunding company set up this option as a grant for companies that have campaigns set up on the platform. People must show that a government mandate related to the coronavirus hurt their enterprises.
This small-business relief option provides $500 matching grants to companies that raise at least that amount. Moreover, the owner must be the beneficiary of the funds raised, and the campaign’s story must include the #SmallBusinessRelief hashtag. Companies selected to receive the grant get it as a donation on the GoFundMe page.
4. The Federal Reserve’s Main Street Lending Program
This program is set up to provide nonprofit and small-business relief to borrowers who engage with participating lenders. These loans have a maturity period of five years.
There are also two-year deferrals of principal payments and one-year deferrals of interest for qualified borrowers. People applying for this support must prove they were in sound business condition before the COVID-19 pandemic occurred.
5. Leniency From Credit Card Companies
People who accessed credit card provider websites lately probably noticed messaging urging customers to reach out if COVID-19 impacted their finances. Credit card companies provide assistance at their discretion, so people should contact specific brands for details.
Some card issuers let people delay their monthly payments or reduce the amount owed. Others provide temporary credit increases that could help customers address urgent financial needs. Credit cards do not restrict this kind of support to people who own companies, but it’s worthwhile for those in need of small-business support to see what’s available for their circumstances.
6. State-Based Assistance
Parties trying to minimize the COVID-19 small-business impact they experience should also explore possibilities at the state level. Some government programs offer help to candidates, but other organizations are assisting, too.
People interested in these options should bear in mind that most of them have various requirements. Parties may need to have operated their businesses for several years to qualify for the aid or have their headquarters in certain districts or cities.
Relief for Small Businesses Is Available
The coronavirus pandemic has hurt small businesses in a wide variety of ways, cutting into their profits and reducing the number of customers that want to visit them. However, the suggestions here show that these enterprises have resources to pursue.
They should take the time to carefully research a financial assistance option and then give themselves plenty of time to fill out the necessary paperwork and submit the documentation. Doing those things increases the chances of success.
Devin Partida writes about investor technologies, big data and apps. She is also the Editor-in-Chief of ReHack.com.
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