SBA Disaster Assistance in Response to the Coronavirus
The U.S. Small Business Administration is offering designated states and territories low-interest federal disaster loans for working capital to small businesses suffering substantial economic injury as a result of the novel Coronavirus (COVID-19). The SBA will issue under its own authority as provided by the Coronavirus Preparedness and Response Supplemental Appropriations Act that was signed by President Trump, an Economic Injury Disaster Loan Declaration.
- The Economic Injury Disaster Loan assistance declaration issued by the SBA makes loans available statewide to small businesses and private, nonprofit organizations to help alleviate economic injury caused by the Coronavirus. In which will apply to current and future disaster assistance declarations related to Coronavirus.
- The SBA’s Office of Disaster Assistance will coordinate with the state’s or territory’s Governor to submit for Economic Injury Disaster Loan assistance.
- Once the declaration is made, the information on the application process will be made available to affected small business within the state.
- The SBA’s Economic Injury Disaster Loans can provide vital economic support to small businesses to help them overcome the temporary loss of revenue they are experiencing by offering up to $2 million in assistance.
- Loans may be used to pay fixed debts, payroll, accounts payable and other bills that otherwise could not be paid due to the disaster’s impact.
- For small businesses, their interest rate is 3.75%. For non-profits their interest rate is 2.75%.
- In order to keep repayments of loans attainable, the SBA offers long-term repayment up to a maximum of 30 years. However, these terms are determined on a case-by-case basis, based on the individual borrower’s ability to repay.
Economic Injury Disaster Advance Loan
Small business owners in the U.S., Washington D.C., and territories are also eligible to apply for an advanced loan up to $10,000 in response to the Coronavirus. Funds will be made available within three days of a successful applications and will not have to be repaid.