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Small business loans for coronavirus impact available

Staff Reports • Mar 17, 2020 at 7:00 PM

WASHINGTON, D.C. — Loans of up to $2 million are available to small businesses affected by the coronavirus, U.S. Small Business Administration (SBA) Administrator Jovita Carranza has announced.

SBA’s economic injury disaster loans can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing.

“The president took bold, decisive action to make our 30 million small businesses more resilient to coronavirus-related economic disruptions. Small businesses are vital economic engines in every community and state, and they have helped make our economy the strongest in the world,” Carranza said.

“Our agency will work directly with state governors to provide targeted, low-interest disaster recovery loans to small businesses that have been severely impacted by the situation,” Carranza said. “Additionally, the SBA continues to assist small businesses with counseling and navigating their own preparedness plans through our network of 68 district offices and numerous resource partners located around the country. The SBA will continue to provide every small business with the most effective and customer-focused response possible during these times of uncertainty.”

WHAT IS THE PROCESS FOR  SBA’s CORONAVIRIS LENDING?

The SBA is offering designated states and territories low-interest federal disaster loans for working capital to small businesses suffering substantial economic injury as a result of the coronavirus. Upon a request received from a state’s or territory’s governor, SBA will issue under its own authority, as provided by the Coronavirus Preparedness and Response Supplemental Appropriations Act recently signed by the president, an economic injury disaster loan declaration.

Any such economic injury disaster loan assistance declaration issued by the SBA makes loans available to small businesses and private, nonprofit organizations in designated areas of a state or territory to help alleviate economic injury caused by the coronavirus.

SBA’s Office of Disaster Assistance will coordinate with the state’s or territory’s governor to submit the request for economic injury disaster loan assistance. Once a declaration is made for designated areas within a state, the information on the application process for economic injury disaster loan assistance will be made available to all affected communities.

These loans may be used to pay fixed debts, payroll, accounts payable and other bills that can’t be paid because of the disaster’s impact. The interest rate is 3.75% for small businesses without credit available elsewhere; businesses with credit available elsewhere are not eligible. The interest rate for nonprofits is 2.75%.

SBA offers loans with long-term repayments in order to keep payments affordable, up to a maximum of 30 years. Terms are determined on a case-by-case basis, based upon each borrower’s ability to repay. SBA’s economic injury disaster loans are just one piece of the expanded focus of the federal government’s coordinated response, and Carranza said the SBA is strongly committed to providing the most effective and customer-focused response possible.

For more information, contact the SBA disaster assistance customer service center at (800) 659-2955 (TTY: 1-800-877-8339) or e-mail disastercustomerservice@sba.gov.

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