Small Business Coronavirus Recovery Options

Written by: Patrick Findaro
Last Updated: April 5, 2022
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This article is based on a video originally recorded on Vetted Biz Youtube Channel

Hello, this is Patrick Findaro. Just wanted to give an update to our clients about different financing mechanisms that the government has put in place and is exploring to keep your businesses ongoing and to recover quickly from this crisis. There are a lot of things that are in the talks right now. For example, there was a memo that the Treasury Department talked about having three hundred billion dollars worth of loans available for what they say as business interruption loans. To put that in perspective, the Small Business Administration issued twenty-eight billion dollars worth of loans through banks last year. And also two billion dollars through loan disaster through their loan disaster program.

COVID-19 Business Federal Loan and Grant Disaster Recovery

So there are a lot of things in the talks. Including the Main Street lending program that the Federal Reserve hasn’t given too many details about. What has already been approved is seven billion dollars of loans for businesses that have been affected by the Coronavirus. And that’s through the Small Business Administration SBA. So that program is already up. Eligible businesses can apply for loans of up to two million dollars. And depending on the financial stability of the business and the background of the owners, the terms can be up to 30 years. The good thing about this program is interest rates are currently capped at three-point seventy-five percent for for-profit small businesses. 

So that's the biggest program that the federal government currently has available for small businesses.

Small Business Covid-19 Relief in States

That being said, many states have loans and to a lesser extent grant mechanisms to help small businesses. Florida is very at the forefront of it with the Small Business Emergency Bridge Loan program. This program gives bridge loans of up to 50 thousand dollars for eligible small businesses. So small businesses with anywhere from two to one hundred employees have an established presence in Florida. And they were established before March 8th of twenty this year.

So definitely a program to look into for those business owners, franchise owners that have businesses currently established in Florida. And it’s 0 percent interest up to twelve months. The unpaid balance then jacks up and the interest rate goes up to 12 percent. So it’s a good short-term fix for businesses that have run into capital needs and maybe have already explored some traditional bank financing where you could expect 7-8 percent plus for a similar type loan up to $50,000.

Patrick

Coronavirus Business Support in Big Cities and Companies

There are other municipalities that have offered grants like New York City. Los Angeles also has a microloan program, loans of $5,000-$20,000 for eligible businesses. Depending on the type of business it can be anywhere from 0 percent to 5 percent interest rates. And there are other state and municipality programs and there are some grants that are offered. Such as through New York City and with big companies like Amazon and Facebook. Right now, the Facebook program just depends on your financing needs and time.

But we looked at it for a few of our clients and it was going to be expected to have a grant up to $300,000 with a lot of work to go into the application. And then we don’t know what the chances of being eligible being granted that those three thousand dollars. We’ll keep you posted. We’re hearing about different programs the government is implementing on a federal, state and municipality level. As well as some big companies are offering their businesses. So if you’re a vendor at Amazon or if you use Facebook for marketing purposes, we’ll keep you updated on these programs and especially the most attractive programs as they become available. Thanks again. And stay safe. And we wish you the best of luck right now during these hard times.

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