Updates as of April 1, 2020
SBA Economic Injury Disaster Loan & $10,000 Advance

In response to the Coronavirus (COVID-19) pandemic, small business owners in all U.S. states, Washington D.C., and territories are eligible to apply for an Economic Injury Disaster Loan advance of up to $10,000. The SBA’s Economic Injury Disaster Loan program provides small businesses with working capital loans of up to $2 million that can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing.

The loan advance will provide economic relief to businesses that are currently experiencing a temporary loss of revenue. Funds will be made available within three days of a successful application, and this loan advance will not have to be repaid.

Working capital loans to help small businesses, small agricultural cooperatives, small businesses engaged in aquaculture, and most private, non-profit organizations of all sizes meet their ordinary and necessary financial obligations that cannot be met as a direct result of the disaster. These loans are intended to assist through the disaster recovery period.

SBA’s Economic Injury Disaster Loans offer up to $2 million in assistance and can provide vital economic support to help overcome the temporary loss of revenue they are experiencing. The loans may be used to pay fixed debts, payroll, accounts payable and other bills that cannot be paid because of the disaster’s impact. The interest rate is 3.75% for small businesses without credit available elsewhere; businesses with credit available elsewhere are not eligible. The interest rate for non-profits is 2.75%.

SBA Payroll Protect Protection Program (PPP)
Application process will open Friday, April 3rd

The CARES Act establishes a new $349 billion Paycheck Protection Program.
The Paycheck Protection Program is specifically designed to help small businesses keep their workforce employed. The new loan program will be available retroactive from Feb. 15, 2020, so employers can rehire their recently laid-off employees through June 30, 2020.
·    Eligible businesses: All small businesses, including non-profits, Veterans organizations, Tribal concerns, sole proprietorships, self-employed individuals, and independent contractors, with 500 or fewer employees, or no greater than the number of employees set by the SBA as the size standard for certain industries·    Maximum loan amount up to $10 million
·    Loan forgiveness if proceeds used for payroll costs and other designated business operating expenses in the 8 weeks following the date of loan origination (due to likely high subscription, it is anticipated that not more than 25% of the forgiven amount may be for non-payroll costs)
·    All loans under this program will have the following identical features:
·    Interest rate of 0.5%
·    Maturity of 2 years
·    First payment deferred for six months
·    100% guarantee by SBA
·    No collateral
·    No personal guarantees
·    No borrower or lender fees payable to SBA

You can apply through any existing SBA 7(a) lender or through any federally insured depository institution, federally insured credit union, and Farm Credit System institution that is participating. Other regulated lenders will be available to make these loans once they are approved and enrolled in the program. You should consult with your local lender as to whether it is participating in the program.

Lenders may begin processing loan applications as soon as April 3, 2020.
The Paycheck Protection Program will be available through June 30, 2020.

 

The Staten Island SBDC team is dedicated to our NYS Mission of providing customized solutions through advisement, education, research and advocacy for Entrepreneurs, Innovators and the Small & Medium Enterprise community. Our team of certified advisors are experienced in Disaster Relief Counseling and are ready to provide small business owners with the guidance they need in these trying times of uncertainty. Now more than ever we are Staten Island Strong for Small Business.