Government Funding Resources You Need to Know
We know most small businesses are struggling financially as the coronavirus crisis continues. Data from our Weekly Pulse Poll shows us just how much—37 percent of 17,500 small businesses reported that they didn't have enough cash to last the next 30 days. And a follow-up question revealed that very few of those businesses know where to get the funding they need.
Luckily, there are resources available to help small businesses stay afloat—and more of them are coming soon. To help you figure out what funding source is best for your small business, we compiled a list of the best government resources. This way, you can see your options all in one place, choose ones that might work for you, and take steps to secure more money now.
We’ll add to this list over time and also go in-depth about many of these resources in future coverage. So consider this a starting point for accurate and relevant funding information for small businesses across North America.
US Government Lending Programs and Support
If you’re looking for federal relief and funding options, the first place you should check out is the Small Business Administration (SBA). They can help small business owners gain access to capital through these programs.
SBA Guaranteed Loans
What are they?
SBA guaranteed loans are options that mitigate the risk for the lender, who might be cautious to provide loans to small businesses. Basically, whoever loans you the money can recover a portion of it if you can’t pay the loan back.
“With an SBA loan guarantee, if a borrower fails to repay the loan, the lender can recover 50 to 85 percent of the outstanding loan balance from the SBA. The borrower, however, remains obligated for the full amount due. This reduces the lender's risk so they are more willing to approve the loan,” reports the SBA in an article about guaranteed loans.
The pros here are that you’re able to access credit that might not have been available before. However, it can sometimes take months to approve these loans and disperse funds. So if you want to explore this option, get started as soon as possible.
How do I apply?
You can apply through an approved financial institution with the SBA’s Lender Match Tool.
Where can I learn more?
Head on over to the loans section of the SBA for more info.
SBA Disaster Relief Loans
What are they?
When natural disasters happen, like the coronavirus, governors can petition the president for disaster relief for a specific area impacted within their state. If the president approves it, the SBA then provides low-interest disaster loans to help businesses and homeowners recover. These loans are typically used if insurance coverage or funding from FEMA isn’t enough to cover the losses.
These tend to have a faster response time than the guaranteed loans, but political involvement and approval can slow them down.
How do I apply?
You can apply through the SBA’s Disaster Loan Assistance program.
Where can I learn more?
Go to the disaster relief section of the SBA for more information or to the coronavirus emergency loans section for specific information.
CARES Act Loans: The Coronavirus Aid, Relief, and Economic Security Act
What are they?
In the newly released stimulus package, there’s an initial 350 billion dollars for small business relief. This program waives many of the traditional SBA requirements, and it’s available for sole proprietors up to businesses with 500 employees.
Under the bill, you can use funds from the loans to pay your employees and cover certain other expenses like utilities or insurance premiums. And you can apply for loan forgiveness if you meet certain requirements. Additionally, businesses applying for these loans can receive an advance of $10,000 within three days of submitting their application.
It sounds great, and it will definitely help small businesses. However, because it’s a new program, we don’t yet know how long it will be available and how long it will take before the funds hit your accounts. And unfortunately, we don’t know if it’s enough money.
How do I apply?
Contact your local financial institution or find an approved lender using Lender Match.
Where can I learn more?
The SBA Coronavirus Center has more information on requirements, processes, and options.
Canadian Government Lending Programs and Support
Small businesses in Canada can check out the below program offered by the Canadian government.
Business Credit Availability Program (BCAP)
What is it?
The Canadian Government is providing assistance through existing financial institutions. Export Development Canada (EDC) and the Business Development Bank of Canada (BDC) are offering more than 10 billion dollars in direct lending and financial support at market rates to businesses. To qualify, your business must have a viable business model and restricted access to financing.
Similar to the CARE loans, this is a new program, so we’re not yet sure when the funds will arrive and how long they will be available for.
Where can I learn more?
You can get more information on BCAP at The Government of Canada’s official site.
Consider options from different sources
In addition to federal funding sources, check your state or province for relief programs offered locally. Some corporations, such as Google, are also offering support to small businesses. These programs can help your business advertise freely, connect with your customers, and generate additional revenue during this tough time.
Come back soon for more information and expert advice on these programs to help make the process as low stress as possible.
What funding sources is your small business planning to use to help you stay afloat during the coronavirus outbreak? Tell us in the comments and feel free to ask questions! We can pose them to our financial experts in upcoming coverage.
Related content: For the latest updates on government resources, visit our Coronavirus Resource and Recovery Center.
Comments (1-10)
this is good information......but how does a small business in the Entertainment Industry get funding for Grants etc..... to survive
I have completed applications on the SBA site for assistance for my small business at the end of March and first of April and have heard nothing. I received one email telling me they streamlined the application and to reapply. I can't seem to reach anyone on the phone abd have no idea what the status is on my application. I am the sole owner of my business and my fiance works with me. We don't have a "payroll" but I am in communicatiin with my banker for PPP. I feel that because im such a small business I will fall between the cracks. We are a small charter boat tour business and were shut down on March 20th until further notice. Like most of the nation, there is no income coming in. I have some ideas that may perhaps bring in a little cash. But hesitate to invest even a little cash to get started at this point. I don't know where to go for assistance and have not found any local assistance programs I qualify for. I do have a small retirement income from teaching in teaching in Marion county FL.. but most of that income goes to pay rent. I can't ask for a referral on my rent because the owners are in the same position as I am and need the rent to pay their bills and business expenses. Any help or advice for the really small business owners woukd be greatly appreciated! My business will be back, we most definitly will reopen when we are permitted and can do so safely! Thank you!!
Thank you for providing this clear information! I plan on applying for a small loan to help me through this period!
Thank you so much. I needed this info.
Just FYI!
"Corona Stimulus" Package for Small Business Owners.
In the U.S. here’s what local businesses can tap into:
• SBA Forgivable Loans Up to $10,000,000*
• SBA Emergency Grant Up To $10,000*
• Withdraw Retirement Penalty Free Up to $100,000*
• SBA Disaster Loans Up To $2,000,000
• Defer Payroll Taxes Sec 2201 To 2021/2022*
• Recovery Rebates $2,400 MFJ/$1,200 Single*
• Get Cash For NOLs In '18, '19, '20*
• Employee Retention Credit Up To $10,000/employee*
• Sick Employee Payroll Tax Credit Up To $2,000/employee/qtr
Learn More Here : https://fitsmallbusiness.com/cares-covid-19-stimulus-package/?st_id=5da4e0b424c17c2e5432fb9d&st_campaign_id=19852377&utm_source=Sailthru&utm_medium=email&utm_campaign=COVID+Send+%233+-+Stimulus+-+3%2F27&utm_term=Master+List&fbclid=IwAR3KKlGeMSEgi5aZmE_CWYBKiGc5lWRJfazXe5ll43B8mX6fI4x270W0HKw
Hope this helps
Loans are great but we all know how hard it is to get out of a hole when you go in debt w personal finances much less large amount of money to keep a business operating. We have been devastated by this and forced to shut doors w 4 large jobs backing out over the last 4 weeks. No other choice but lock and pray. We have filled out all the necessary forms but it’s scary to go in debt to stay open. COVID 19 will have months and months of impact on the economy. Many small business will not survive. Really a sad day for the small business guy.
Look at the requirements for a disaster loan...the paperwork is just the same as for any regular loan. We need it fast, or we go under.
In Any Business whether big or small…. Any dollar whether its $1000.00 or $10.000.00 is a lot to any business when you put your Heart and Soul into it's a full time small business in the Entertainment Industry - I've lost many Weddings $4200.00 worth. Anybody deserves some help if they ask for it. !!!
I have been researching other avenues of assistance for my monthly customers.
1. Opening up a new bank account can give you access to immediate lines of credit
2. There are go fund me accounts in place from companies like Amazon and quickbooks. The applications to apply for the Grant's have not been released yet.
And the most important thing to know.....THE IRS IS TEMPORARILY SHUT DOWN. THEY ARE NOT EXCEPTING INCOME VERIFICATION FORMS FOR LOANS AT THIS TIME. AND NO ONE IS IN OFFICE TO ANSWER QUESTIONS CURRENTLY. Feel free to contact me with more updates. I received this notice from the IRS on 3.27.20.
Hi to All,
Miss Taylor super Great info , we are working at this very moment even today Sunday to meet the demands requested by business owners all over the country for the SBA 7a emergency package relief, all awhile working from our home offices!
Than you for this very needed posting.
Richard Vega
Senior Financial Consultant
United Capital Point LLC.