Update August 4th, 2020
Update: The Paycheck Protection Program has been extended until August 8th.
The Small Business Administration, or SBA, has received additional funding of $300 billion through the Coronavirus Preparedness and Response Supplemental Appropriations Act and has restarted processing loan applications from small businesses, after a temporary hiatus. The loans are processed on a first come, first served basis. SBA is also accepting new applications for the Paycheck Protection Program beginning April 27 at 10:30 am EDT. The new interest rate for the Paycheck Protection Program is set at 1%.
Small businesses are emblems of American entrepreneurship, incubators of innovation, and contributors to community identity. Thriving small businesses are the vital signs of a healthy economy.
COVID-19 is sweeping across countries and shaking down well-established economic systems; small businesses have been hit the hardest. Public health measures, such as social distancing, curtail the spread of the novel coronavirus and restrict businesses in our communities. The symptoms of economic distress are manifested as partial and complete shutdown of these business operations.
To offer economic relief to individuals, families, and businesses impacted by the COVID-19 pandemic, the federal government in the United States passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The CARES Act provides the much-needed economic safety net for small businesses for business continuity. The funds earmarked to support small businesses is $349 billion; these funds are extended as Small Business Administration (SBA) loans. Small businesses can choose from the following financial products offered by the SBA.
- Paycheck Protection Program
- Economic Injury Disaster Loan
- Economic Injury Disaster Advance Loan
The Economic Injury Disaster Advance Loan Program provides a quick respite for borrowers—the funds will be available within 36 hours. Up to $10,000 can be requested as a loan advance through this program.
In addition, there are tax credit programs that small businesses can take advantage of. States and counties have local funding assistance available for small businesses. Corporate firms are also offering grants to small businesses during this time. For example, Facebook COO, Sheryl Sandberg has announced a $40 million grant from Facebook for small businesses.
Though small businesses may be bruised and battered, they will bounce back with greater resiliency. Now is the time for diligent planning and preparation for a new and brighter future as we wait out this pandemic. Ensuring that your workforce is knowledgeable about COVID-19 and how to combat it will be a part of the blueprint for preparation. Today, eLearning is mainstream—consider employee enrichment programs through online learning opportunities. If you are a small business in the manufacturing sector affected by the COVID-19 pandemic, reach out to our team for learning and development opportunities for you and your employees.