Financial assistance for small businesses during COVID-19
Companies across the country have been impacted by the COVID-19 pandemic, and many business owners are seeking financial support.
As the COVID-19 pandemic continues to affect individuals, communities, and the broader economy, it’s likely your business has been impacted financially. Whether dealing with reduced cash flow or reduced operating hours — you may be among those seeking financial assistance to weather the storm.
Review these sources of business assistance to find out whether you are eligible to apply. Keep in mind that the relief landscape can change day-to-day, so it’s a good practice to check these websites for the latest information.
1. U.S. Small Business Administration (SBA) relief programs In addition to its traditional funding programs, the SBA has created a few temporary funding programs to provide relief to businesses affected by the COVID-19 outbreak. Funding options include forgivable loans under the Paycheck Protection Program (PPP), emergency loans and loan advances, Express Bridge Loans, and debt relief. (Please note Wells Fargo is no longer accepting applications for the loans under the PPP, and is waiting to see if or when the SBA will receive any additional congressionally approved funding for this important loan program.)
These SBA programs may change or close over time as the economic situation continues to evolve. Visit the SBA’s Coronavirus Relief Options website for up-to-date information and links to apply.
2. Federal Reserve Main Street Lending Program The Federal Reserve established its Main Street Lending Program to support small- and medium-sized businesses with up to 15,000 employees or up to $5 billion in annual revenue. The Main Street Lending program is similar to a traditional business loan program, with the benefit of generally low interest rates (LIBOR (1- or 3-month) plus 3.00%), and deferral of payments on the principal and interest payments for one year. The minimum loan size starts at $500,000 and the repayment term is four years. Learn more about the Main Street Lending Program on the Federal Reserve’s website.
3. Employee Retention Credit The Internal Revenue Service (IRS) and Treasury Department launched the Employee Retention Credit to encourage businesses to keep employees on their payroll. The refundable tax credit is up to $5,000 in wages paid by an employer — regardless of size — whose business finances have been affected by COVID-19. To be eligible, the employer’s business must be fully or partially suspended by government order due to COVID-19 or the employer’s gross receipts must be below 50% of the comparable quarter in 2019. Businesses who received funding through the PPP are not eligible for the Employee Retention Credit. Find out more information on the IRS website.
4. Local and state-specific assistance To supplement federal funding programs, many state and local governments have created assistance programs to support business owners in their area. Check your state governor’s website to find up-to-date information about state-specific assistance programs. Contact your local chamber of commerce to find out whether there are any local or regional assistance programs near you. The SBA works with a number of local partners to mentor, train, and counsel small businesses. Use the SBA’s local assistance directory to locate the nearest SBA district office.
5. Bank assistance Banks across the country are taking steps to support customers — both individuals and businesses — directly impacted by the COVID-19 pandemic. Support efforts include waived fees, deferred payments, low-rate and zero-rate loans, and more. The American Bankers Association offers a list of publicly announced relief efforts from America’s banks. Check with your bank’s website to see what assistance they are offering small business customers.