5 Resources (Besides PPP) for COVID-19 Help for Your Small Business
With so many small businesses struggling during the coronavirus outbreak as shutdown and stay-in orders extend into months, governments and other organizations are offering varying assistance to help companies. Here are 5 places to look for assistance.
Some federal funding for small businesses can be found in programs offered through the Coronavirus Preparedness and Response Supplemental Appropriations (CARES) Act, signed into law March 6, which includes a $376 billion package in relief funding for American workers and companies. However, the U.S. Small Business Association (SBA) has since announced that funds for two of its programs through the CARES Act – the Paycheck Protection Program and Economic Injury Disaster Loan Program (EIDL) – were exhausted and applications no longer accepted. While waiting to hear whether more funding will come through for these programs, there are other opportunities for those seeking relief, such as the Federal Reserve’s Main Street Lending Program.
And there’s also help through several city and state government programs as well as local efforts by community groups and other civic organizations to support their area businesses.
If you’re among the small business owners who could use the help during the pandemic, take a look at these 5 types of assistance.
Main Street Lending Program
This program is run by the Federal Reserve to provide lending to small and medium-sized businesses that were in good standing prior to the coronavirus (COVID-19) pandemic. With this program, banks are able to give out loans easier as the Federal Reserve will buy back most of the loan using money allocated through the CARES Act. With the Paycheck Protection Program and Economic Injury Disaster Loan on hold due to lack of funding right now, this program may be a good alternative for businesses seeking relief. The program offers 4-year loans to companies with up to 10,000 employees or make less than $2.5 billion in revenue. Some of the requirements to qualify for this loan include making “reasonable efforts to maintain payroll and retain workers.” Businesses who have received help from the PPP may also apply for the Main Street program. The Federal Reserve is still working on operational details for the program. Check the Main Street Lending Program page frequently as more information is released.
The Employee Retention Tax Credit (ERTC)
A provision of the CARES Act, the ERTC is a way for employers to retain employees on their payroll due to the financial impact of the coronavirus crisis. According to the IRS, the tax credit is fully refundable “for employers equal to 50 percent of qualified wages (including allocable qualified health plan expenses) that Eligible Employers pay their employees.” The credit, which applies to qualifying wages paid after March 12, 2020 and prior to January 1, 2021, provides up to $5,000 for each employee. Government employees and those who are self employed aren’t eligible for this credit. There are a few more restrictions, however, such as employers who are getting relief through the PPP won’t be able to qualify for this credit as well. The IRS provides more details about the credit through its FAQs.
SCORE, a nonprofit organization that offers volunteer, expert business mentors, is reaching out to small business owners who may need assistance with issues they’re facing during the coronavirus outbreak, including help with the funding application process.
“More than ever, challenging times call for trusted business guidance and resources,” the SCORE website says. “We offer practical advice and insightful tips based on years of experience.”
The group, which has chapters around the U.S., is offering remote mentoring via phone, email, video and chat for “free, personalized assistance to address the current crisis to help you adapt your business.”
Grant Programs & Free Services
Several corporations and nonprofits have announced donations and programs that can provide help ranging from grants to free services.
A few are industry- or demographic-specific assistance while other recovery programs for small businesses are available to the wider range of companies.
Verizon donated $2.5 million to the nonprofit Local Initiatives Support Corporation (LISC) for a Small Business Covid-19 Recovery Fund for grants of up to $10,000 to struggling businesses.
“We are offering grants to help small businesses fill urgent financial gaps until they can resume normal operations or until other more permanent financing becomes available,” LISC says.
The nonprofit says it will use the Verizon funding to help businesses facing immediate financial pressures due to COVID-19, “especially entrepreneurs of color, women-owned businesses and other enterprises in historically underserved communities who don’t have access to flexible, affordable capital.”
Yelp set up an assistance fund of $25 million to help support independent local restaurants and bars, in the form of waived advertising fees, and free advertising and products and services.
Other companies offering assistance include Facebook, which started its Small Business Grants Program to provide $100 million in cash and ad credits to 30,000 businesses in the 30 countries where Facebook operates. And, Google says it set aside $340 million in ad credits for small businesses that have had active accounts in the past year.
Express Bridge Loan Pilot Program
This SBA assistance program is for businesses that already have a relationship with an SBA Express Lender. If so, you may be eligible for “quick access” to a bridge loan of up to $25,000.
“These loans can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing and can be a term loan or used to bridge the gap while applying for a direct SBA Economic Injury Disaster loan,” the SBA says.