The pandemic has presented many challenges, especially for small businesses. Many small businesses have been struggling to survive. The Small Business Administration (SBA), offers a wide array of loans. In addition to financial assistance, the SBA offers technical assistance with everything from starting a business, to maintaining it, overcoming pandemic challenges, and more. These are 3 ways that small businesses could receive assistance from the SBA through the pandemic and beyond.
3 Ways the Small Business Administration Can Assist Your Business
1. Small business loans and grants for the pandemic:
The SBA offers a variety of business loans particularly for small businesses. These include some loans that are specific to pandemic challenges.
- The SBA Economic Injury Disaster Loan (EIDL): This loan offers economic relief to small businesses and nonprofits that are experiencing a loss of revenue due to the pandemic. The funds can be used to meet financial obligations and operating expenses that the organization hasn’t been able to due to COVID. Businesses can use the funds for working capital and normal operating expenses. The loan threshold is up to $150,000 for 12 months of economic injury. The loan terms are 30-year fixed at 3.75%. There is no pre-payment penalty or fees. Applications for this SBA loan are being accepted through December 2021.
- SBA Shuttered Venue Operator Grant: As the name connotes, this is not a program for government small business loans. These are grants that don’t need to be paid back. To be eligible an organization or business must be a shuttered venue (like a concert hall or movie theater) that needed to close during the pandemic. The grants may be up to 45% of gross earned revenue, with a maximum amount for a single grant of $10 million.
2. Small business loans for beyond the pandemic:
There are three kinds of Small Business Administration loans that are available now and beyond the pandemic. These are options for people who have trouble getting conventional funding. To obtain these loans, an organization will need to go through a designated lender. If an organization doesn’t have a lender, they can use the SBA’s Lender Match tool to get connected with one.
- SBA 7a Loans: These loans are meant to be used for working capital. They offer financial aid for businesses with special requirements. They’re also one of the most commonly-used SBA loan programs.
- SBA 504 Loans: These loans are not meant to be used for working capital. Businesses or organizations can use these funds for fixed assets. These loans are long-term, fixed rate financing for up to $5 million for fixed assets.
- Micro Loans: These are loans with higher interest rates (somewhere between 8 and 13%. Organizations can get loans of up to $50,000. These loans are provided through the SBA intermediaries.
3. Technical assistance from the SBA:
Beyond small business loans, the SBA also supports small businesses by giving them access to assistance with everything from business plans, to cash flow analysis, to marketing. These are the five ways that the Small Business Administration offers technical assistance to small businesses.
- SBA Resource Partner Network: This organization pairs small businesses up with advisors (for free) that have extensive experience running their own small businesses. They can offer guidance with business plans, financial statements and projections, cash flow analysis, marketing and branding (including social media).
- SCORE: This free resource pairs small businesses with an experienced volunteer who can offer guidance on marketing, business plan preparation, and loan applications, as well as expert business counseling. All guidance and advice is confidential and can be done in person or online. These are the numbers for the Massachusetts branches of SCORE:
- Boston: 617-565-5591
- Cape Cod: 508-775-4884
- Northeast MA: 978-927-2282
- Southeast MA: 508-587-2673
- Western MA: 413-785-0314
- Worcester/Central MA: 508-753-2929
- Massachusetts Small Business Development Centers: These organizations combine the resources of the SBA, local government, the private sector, and academia. They’re typically located at colleges and universities. These centers offer free and confidential guidance and assistance with business plans, loan applications, exporting, and government contracting.
- The Veterans Business Outreach Centers: These organizations offer free guidance and technical assistance to veteran-owned and operated businesses. They often pair with the Center for Women and Enterprise to offer assistance for business owners or to hold events.
- The Center for Women and Enterprise: These organizations offer (free) support specifically for woman-owned and operated small businesses. They offer classes in how to write a business plan, support for launching a business, two hour workshops on specific topics, one-on-one legal and business consulting. They also offer classes to support women in their job search and networking opportunities for business owners and job seekers.
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