How to Find Money for Your Business for Coronavirus Relief
Over the past few days, additional confirmed cases of the novel Coronavirus COVID-19 were reported, leading to many cities canceling schools and public events. Some cities and states have even mandated restaurants and bars be closed indefinitely. Individuals are being urged to stay home as much as possible to help contain the spread of the disease as to not overload the health system.
While there are certain businesses that will be insulated from the impact of coronavirus, for the overwhelming majority, it is no longer a question of if your business will be impacted but a question of when and to what degree. Fortunately, there are many options and initiatives available to help businesses cope with the loss of revenue and disruption to regular business during these trying and uncertain times.
SBA Economic Injury Disaster Relief Lending
The Small Business Associations (SBA) will be offering loans up to $2 million to businesses that have been negatively impacted by the effects of the coronavirus. Like their other loan programs, the SBA works with the government and lending institutions to help businesses secure low-interest loans. In this case, not only will the loans have low interest, but they will also offer long-term repayment options, up to a maximum of 30 years. These loans are designed to help businesses cover the losses in revenues or additional incurred expenses they are experiencing as a result of the virus.
Every state is reacting to COVID-19 depending upon its current level of impact. States and cities like Washington, San Francisco, and New York City already have measures in development or in place. Make sure to stay current on your state and local news for legislative measures that may impact or provide relief to you or your business. Even if your state or locale has yet to announce any initiatives, it is probable they will in the coming days and weeks.
Contact Your Financial Institution(s)
Many financial institutions are attempting to do their part to help both businesses and individuals access to cash. You should research or contact any institution where you have financial interests to see what options may be available to you. As an example, Citi is waiving fees for early CD withdrawals. It is likely your institutions are offering similar options or will follow suit shortly.
Small Business Loans
You may even find that your financial institution offers small business loans specifically for mitigating the fallout from the coronavirus independently, outside of SBA loans. As the urgency to limit personal contact continues to permeate through the country, it is possible to bank offices may close. However, it is anticipated that most financial institutions will continue to offer services via the phone or the internet. If you need to consider a loan and choose not to or are unable to apply for an SBA loan, you may want to consider your current financial institutions if they remain operational or even online banks. It is unlikely these loans will offer terms as favorable as SBA loans but can be an alternate option for your business if need be.
Business Interruption Insurance
Several businesses are already covered by business interruption insurance. Others may still be eligible if they have not yet been impacted but they will need to act quickly. If you already have this insurance, it is advisable to contact them, so you are clear on your benefits and the type of relief available to you under your plan. If you do not, now may be the time to research the plans available. If you choose to purchase a plan at this stage, review the details carefully to ensure it makes sense for your business and that it will apply to possible losses incurred under COVID-19.
Pending & Future Initiatives
There are a number of pending initiatives at the federal, state, and local levels that have been introduced in an effort to offset the economic impact of the hardships being endured by businesses and employees due to the virus. Their fate is currently unclear, but it is anticipated that measures will quickly be considered, voted upon, and/or decided. The best advice is to stay up-to-date with the latest initiatives to determine if the various measures will apply to your business so you know how to act accordingly if they do. The future impact of the coronavirus is uncertain but it is probable that further legislative measures will be introduced to help those that are being impacted the most.