HUNTINGTON, WV (WOWK) — In the midst of the 2020 Coronavirus Pandemic, experts say 25% of small businesses have closed either temporarily or indefinitely. Experts add another 25% of small businesses will do the same by the end of April, 2020. The alarming numbers beg the question, ‘what resources are available for business owners?’
Like the rest of us, business owners want to know how long this pandemic will last. And while that answer may not be clear from state to state, the Small Business Administration has just received some major funding.
Thanks to the CARES Act, the SBA’s ‘Paycheck Protection Program’ now has $350 billion dollars to assist any small business applying for this program, so long as they have 500 or less employees.
The program allows business owners to keep their employees on payroll while states across the nation have ‘Stay-At-Home’ orders in place.
“SBA is not going to be reviewing the loan application, we’re letting the bank do that and we’re backing the bank up and holding them harmless in any review,” said Steve Bulger, SBA Regional Administrator.
SBA officials say right now, it’s the program with the most funding and quickest turn around. To apply for the loan, Bulger says you need documents showing your average monthly payroll and take that to your lender.
“Some people are worried the program’s going to run out of money before they get in there,” Bulger said. “There’s going to be a lot of money in the weeks to come, so just get your paperwork together, get to the bank, and get that application in.”
According to Bulger, the loan consists of 2.5 times your average monthly payroll and should be available within 7 to 10 days. SBA officials say if you use at least 75% of the loan on payroll, the loan will be forgiven by the SBA. Bulger says these are two-year loans with a 1% interest rate and believes the program will get up to $600 billion dollars.
Currently, if you have a loan with SBA, they will take care of the principal and interest rates for the next 6 months, according to Bulger.
“We [need] to make sure to save as many small businesses, and large businesses as we can, so that when we come out on the other side of this coronavirus situation, we’ll be able to ramp up the economy up as quickly as possible,” Bulger said.