ARTICLE
The federal government has acted, and $350 billion in loans are now available to help small businesses impacted by the coronavirus. Learn how to access those funds in our Small Business Town Hall. As small businesses continue to navigate challenges related to the coronavirus pandemic, one of the biggest is determining if new government loan programs can help them keep employees. The Payroll Protection Program (PPP), part of the $2 trillion CARES Act, was explicitly passed to help small businesses maintain payroll, but sorting through this complex legislation has not been easy for small business owners. At the second National Small Business Town Hall, held on April 3 by the U.S. Chamber of Commerce and Inc., a panel of business leaders walked employers through the latest information on the PPP and related topics. Much of the U.S. government's guidance on PPP has been updated in the past week, so they’ve been keeping track of all the latest developments. During the Town Hall, Inc. editor-at-large Kimberly Weisul spoke with several experts, including Neil Bradley, executive vice president and chief policy officer at the U.S. Chamber of Commerce; Manny Cosme, president and CEO of CFO Services Group; Danny Fitzgerald, associate regional director of San Diego-Imperial SBDC Regional Network; Marilyn Landis, president and CEO of Basic Business Concepts, Inc.; and Dan Martini; VP of Congressional relations and public policy for the American Bankers Association. Here are seven important takeaways from these business leaders when it comes to the Paycheck Protection Act and what businesses should be doing during this critical time. Many small businesses can start applying for PPP loans immediately Bradley said that businesses should be able to start applying for PPP loans from private banks now. Starting April 3, small businesses and sole proprietorships were able to start applying for loans. Starting April 10, independent contractors and self-employed individuals can begin applying. However, he also notes many lenders are not set up to process the loans just yet, given that the loan program passed through Congress a week ago and is still being updated by the Small Business Administration (SBA). Lenders are scrambling to get this in place and some will not be ready to process loans until next week. The best bet for small businesses is to check with their existing lender to see when they can apply via their system. The Paycheck Protection Program loan program changed a lot in a week Since the passage of the CARES Act on March 27, several important provisions of PPP have been changed. Bradley said that these changes include: Originally, the interest rate on PPP loans was set at .5%, and now the loan is set for a 1% interest rate. This could still change, but if you lock in that 1% interest rate today, that will be your set rate. PPP loans mature after two years Businesses are required to use 75% of their PPP loan proceeds for payroll, which reduces how much of the loan can be used on mortgage, rent, and utility payments. Paperwork requirements for loan processing have been simplified further, and tax filings that show payroll amounts for 2019 will work. Eligibility for small businesses has been expanded to include all small businesses that have all employees working in the U.S., no matter if any owners are foreign. Click here to watch the complete webinar.
The federal government has acted, and $350 billion in loans are now available to help small businesses impacted by the coronavirus. Learn how to access those funds in our Small Business Town Hall.
As small businesses continue to navigate challenges related to the coronavirus pandemic, one of the biggest is determining if new government loan programs can help them keep employees. The Payroll Protection Program (PPP), part of the $2 trillion CARES Act, was explicitly passed to help small businesses maintain payroll, but sorting through this complex legislation has not been easy for small business owners. At the second National Small Business Town Hall, held on April 3 by the U.S. Chamber of Commerce and Inc., a panel of business leaders walked employers through the latest information on the PPP and related topics. Much of the U.S. government's guidance on PPP has been updated in the past week, so they’ve been keeping track of all the latest developments. During the Town Hall, Inc. editor-at-large Kimberly Weisul spoke with several experts, including Neil Bradley, executive vice president and chief policy officer at the U.S. Chamber of Commerce; Manny Cosme, president and CEO of CFO Services Group; Danny Fitzgerald, associate regional director of San Diego-Imperial SBDC Regional Network; Marilyn Landis, president and CEO of Basic Business Concepts, Inc.; and Dan Martini; VP of Congressional relations and public policy for the American Bankers Association. Here are seven important takeaways from these business leaders when it comes to the Paycheck Protection Act and what businesses should be doing during this critical time. Many small businesses can start applying for PPP loans immediately Bradley said that businesses should be able to start applying for PPP loans from private banks now. Starting April 3, small businesses and sole proprietorships were able to start applying for loans. Starting April 10, independent contractors and self-employed individuals can begin applying. However, he also notes many lenders are not set up to process the loans just yet, given that the loan program passed through Congress a week ago and is still being updated by the Small Business Administration (SBA). Lenders are scrambling to get this in place and some will not be ready to process loans until next week. The best bet for small businesses is to check with their existing lender to see when they can apply via their system. The Paycheck Protection Program loan program changed a lot in a week
Since the passage of the CARES Act on March 27, several important provisions of PPP have been changed. Bradley said that these changes include:
Click here to watch the complete webinar.