The U.S. Congress has done something unprecedented in terms of direct financial assistance to small and medium-sized companies. In response to the Coronavirus pandemic (COVID-19), small businesses’ owners all over the U.S. who are in good standing with the U.S. Small Business Administration (SBA) and the Internal Revenue Service (IRS) may be eligible to request a loan for the economic emergency, known as the Economic Injury Disaster Loan, which covers a down payment up to $10,000.00 designed to be provided to the business without a full repayment obligation. This down payment represents a financial aid to businesses with less than 500 employees (among which sole proprietorships, independent entrepreneurs and self-employed workers), non-profit private organizations or organizations within the meaning of section 501(c)(19) of the tax code, which are currently recording a temporary loss of income due to COVID-19. This prepayment will be made available in the business’ bank account within THREE DAYS after the submission of the request that was successful and it will not have to be returned on the condition that the funds are employed to pay the wages of the employees, to pay sick leave, to face potential higher production costs due to disruptions in the supply chain or to pay back business’ debts, rent fees, and mortgages.
Furthermore, the loan program for the economic emergency offers small businesses capital loans up to $2 million, with an interest rate of 3.75% for 30 years. This loan is subject to specific conditions and it will request personal and businesslike financial information of the last 2-3 years.
