The $1200 stimulus package to individual is great, but small businesses (under 500 employees) need a ton of more support during this time.
Let’s go over some resources small businesses in the Keweenaw can look into to make it through this huge economy pause.
Small Business Administration (SBA) Resources
Paycheck Protection Loans
The U.S. Small Business Administration (SBA) will guarantee loans with terms of up to 10 years and interest rates of up to 4% to businesses with fewer than 500 employees. Businesses can qualify for loans of up to $10 million, and the loans will be provided by lenders including banks and credit unions. Eligible businesses can get loan deferment for six months to a year, and the loan may be forgiven if the businesses maintains its payroll for eight weeks at employees’ normal salary levels. This is a great resource for businesses who are on the fence of laying off employees or paying them their average wages while their business is closed due to government rule.
Here is the direct link going over how to fill out the Paycheck Protection Loan application. Right now https://www.sba.gov is telling people to go into a bank to fill this out. Umm…most banks are closed. Soon (estimate: April 3rd — you should be able to apply and fill out online). I will keep you updated on this post when the real application becomes available.
As part of its disaster assistance program, the SBA is providing working capital loans to small businesses and nonprofits affected by the coronavirus. These loans carry an interest rate of 3.75% for small businesses and 2.75% for nonprofits. Loan repayment terms vary by applicant, up to a maximum of 30 years. The stimulus updated the program so that sole proprietors and businesses with fewer than 500 employees qualify, and applicants don’t need to provide a personal guarantee on loans under $200,000. Payments can also be deferred for up to four years!
Read more about this loan here.
Even if your business is denied a loan, you can still access this grant, which can be used to provide employee sick leave, maintain payroll or meet other needs like paying rent.
Michigan Small Business Relief Program
The State of Michigan will provide both grants and loans to small businesses affected by COVID-19 starting on or around April 1. Grants will be available in amounts of up to $10,000 to help cover working capital. Loans will be available in amounts from $50,000 to $200,000 at interest rates of 0.25%.
Who’s eligible: Companies with 50 employees or fewer can qualify for grants, while loans are targeted at companies with 100 employees or fewer that can’t get credit elsewhere. In both cases, businesses must show income loss.
How to apply: Applications aren’t yet available but check Michigan Economic Development Corporation for updates.
All in all – we’re in this together.
If as a business you don’t have a website there are a few things you can do to sell your merchandise, gift cards, etc online. You can see a sneak peek how to sell products on Facebook here or email me for the full instructions on how to do so — I’m offering free knowledge during this crazy time so we can all survive as entrepreneurs!