4 Funding Options During COVID-19
With the current conditions, we thought it would be helpful to write a quick overview of the programs that are available to help businesses survive during this trying economic time. Please bear in mind, this is simply an overview and we recommend you speak with a professional to answer specific questions regarding each program and how it would apply to your business.
First and foremost, speak directly to your creditors. Are they offering any type of assistance such as payment deferments that you could take advantage of, even if it’s for the next 1 or 2 months?
Economic Injury Disaster Loan (EIDL) – This is a loan with a term limit of up to 30 years, with a deferment of payments to start after up to 12 months. The maximum loan amount is $2 Million. There is a grant component that is an advance on the loan of $15,000 that you do not pay back if your loan is not approved. It is available to businesses with 500 or fewer employees that are Sole Proprietors, Independent Contractors, LLCs, Partnerships, C Corporations, or S Corporations. This loan is funded through the SBA, and you apply at www.SBA.gov.
Paycheck Protection Program (PPP) – This is an amount that includes your total payroll cost for the previous 60 days, multiplied by 2.5. Forgiveness of the entire amount is dependent on at least 75% of these funds being used specifically for payroll, but the remaining 25% may be used for rent, lease, or utility payments for the business. Businesses classified as Sole Proprietors, Independent Contractors, LLCs, Partnerships, C Corporations, or S Corporations. This is also funded by the SBA but is originated by approved Banks and Credit Unions.
We recommend using one of our wonderful local banks where you can speak directly with professionals. Should you need a list of contacts, please let us know.
Here are some links to information comparing the EIDL and PPP options that go into greater depth:
SBDC’s SBA Coronavirus Pandemic Disaster Loans Comparison: View Document
The Small Business Owner’s Guide to the CARES Act: View Document
Some businesses may need a smaller influx of cash to make it through, you may want to look into the Kiva loans. The maximum loan through Kiva is $15,000 and they are offering a 6-month grace period to begin repayment. Also, these loans are at 0% APR. To apply, visit kiva.org/borrow.
Businesses located in the City of Tulsa with less than 50 employees and 2019 revenue under $5 Million, may want to look into the Tulsa Business Resilience and Recovery Program. This loan is up to $50,000 and does not interfere with any EIDL or PPP funding. You can get more information and apply at https://tedcnet.com/.
With over two decades of in-the-trenches marketing experience, Matthew Maennche’s views on developing and supporting a successful business are fundamentally different from the norm. As a developer and strategist, Maennche has helped thousands of businesses of all sizes, both domestic and international, take their organizations to the next level.
Matthew also spends time giving back to the local business community as a volunteer, mentor, and leader for the local chapter of SCORE.