Many of our small business customers have been reaching out in an attempt to understand the available financing options to help successfully overcome the economic impact of the COVID-19 epidemic. With no shortage of information available in the media it can be difficult to determine what is truth and what is speculation.
These articles reference two programs available to businesses:
Economic Injury Disaster Loans & Emergency Economic Injury Grants: These grants provide an emergency advance of up to $10,000 to small businesses and private non-profits harmed by COVID-19 within three days of applying for an SBA Economic Injury Disaster Loan (EIDL). To access the advance, you first apply for an EIDL and then request the advance. The advance does not need to be repaid under any circumstance, and may be used to keep employees on payroll, to pay for sick leave, meet increased production costs due to supply chain disruptions, or pay business obligations, including debts, rent and mortgage payments.
Paycheck Protection Program (PPP) Loans: The program would provide cash-flow assistance through 100 percent federally guaranteed loans to employers who maintain their payroll during this emergency. If employers maintain their payroll, an approved portion of the loans may be forgiven, which would help workers remain employed, as well as help affected small businesses and our economy snap-back quicker after the crisis. PPP has a host of attractive features, such as forgiveness of up to 8 weeks of payroll based on employee retention and salary levels, no SBA fees, and at least six months of deferral with maximum deferrals of up to a year. Small businesses and other eligible entities will be able to apply if they were harmed by COVID-19 between February 15, 2020 and June 30, 2020. This program would be retroactive to February 15, 2020, in order to help bring workers who may have already been laid off back onto payrolls.
- Economic Injury Disaster Loans & Emergency Economic Injury Grants are available now directly through the SBA and can be applied for here: https://covid19relief.sba.gov/#/
- Note that acceptance of a $10,000 Emergency Economic Injury Grant may impact the amount of forgiveness of a Paycheck Protection Program loan
- Paycheck Protection Program (PPP) Loans are available directly through Intercity State Bank.
- All financial institutions are anxiously awaiting guidance from the SBA on how to process these loans and expect answers shortly.
- Please visit the Intercity Business Banking COVID-19 website for important information on this program including the application and program details
- Feel free to contact a business banker at Intercity to learn more about this program.
Thank you for choosing to trust Intercity State Bank! We look forward to working with you in every way possible to ensure that your business weathers this storm. Watch for future emails with additional details and use our website as a trusted source of information. Please don’t hesitate to reach out to any of our business bankers with questions.