COVID-19 Small Business Relief Programs and Cash Options
Accessing cash to support your business through the COVID-19 pandemic can be challenging for small businesses. Here are a variety of programs and options that you can consider to help you.
The U.S. Small Business Administration (SBA) is offering the Paycheck Protection Program
The Paycheck Protection Program is a loan designed to provide a direct incentive for small businesses to keep their workers on the payroll. SBA will forgive loans if all employees are kept on the payroll for eight weeks and the money is used for payroll, rent, mortgage interest, or utilities. The Paycheck Protection Program will be available through June 30, 2020.
The U.S. Small Business Administration (SBA) is offering the Economic Injury Disaster Relief Loan Program
Small business owners in all U.S. states and territories are currently eligible to apply for a low-interest loan due to COVID-19 through the SBA. The Economic Injury Disaster Loan Program makes loans available to small businesses and private, non-profit organizations to help alleviate economic injury caused by COVID-19. These loans may be used to pay fixed debts, payroll, accounts payable and other bills that can’t 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 offers loans with long-term repayments in order to keep payments affordable, up to a maximum of 30 years. Terms are determined on a case-by-case basis, based upon each borrower’s ability to repay.
Max Loan: $2 million. Might have to put up collateral for loans >$25K.
Rates: 3.75% for Small businesses; 2.75% for non-profits
Term: up to 30 years
Time to fund: 3+ weeks
Kabbage offers business lines of credit of up to $250,000. To qualify with Kabbage Funding, you should be in business for at least one year and have a minimum of $50,000 in annual revenue or $4,200 per month over the last three months. Kabbage does not charge interest, but instead charges a monthly fee and there is no penalty for pre-payment. View Frequently Asked Questions about Kabbage.
Max Loan: $250,000
Rates: equal monthly payment for term + a monthly fee
Term: up to 18 month term loan
Time to fund: Typically within 1-2 business days
Fundbox offers business lines of credit of up to $100,000 for up to 24 weeks. To qualify for Fundbox, you need at least a 500 minimum credit score, a minimum of $50,000 in annual revenue, and 3 months of verifiable business activity in either your Accounting Software or Business Checking account.
Max Loan: $100,000
Rates: 10% – 80% APR
Term: up to 18 month term loan
Time to fund: Typically within 1-2 business days
If you are already a QuickBooks customer, then you may want to consider funding through QuickBooks Capital. With lines of credit available up to $100,000 for up to 12 months, and funding in 1-2 business days it can be an attractive option.
Max Loan: $100,000
Rates: 12% – 34% APR
Term: up to 12 month term
Time to fund: Typically within 1-2 business days
Plastiq allows you to pay virtually all of your business expenses using your existing credit cards even when cards are not accepted. Plastiq charges a 2.5% fee for each transaction, the recipient does not need a Plastiq account and can get paid via ACH, Wire, or paper check. This is a great option if you have available credit on your credit cards but need to pay vendors who do not currently accept credit cards.
Facebook Small Business Grants Program
Facebook will be offering $100M in cash grants and ad credits to help during this challenging time. The application process has not yet started (as of 3/27/20), but you can sign-up for updates to learn more when they begin accepting applications.