Small businesses in Minnesota feeling the pinch from the novel coronavirus pandemic are now allowed to apply for disaster loans made available by the U.S. Small Business Administration.
The opening of the Economic Injury Disaster Loan Program isn't a free pass to financial assistance, but it is an option for small businesses that have been hit hard by mandatory closures amid the epidemic.
“Small businesses across Minnesota are putting the health of their neighbors before their bottom line,” Walz said Saturday. “This assistance will help our state’s businesses recover from the economic hardship caused by COVID-19.”
Businesses all across Minnesota, and select counties in Iowa, North Dakota, South Dakota and Wisconsin, can receive loans of up to $2 million with a maximum repayment period of 30 years.
The loan can be used to keep up with accounts payable, debt, payroll and other bills.
To be approved, the SBA will check credit history, look to see that a business can repay the loan, and collect collateral (real estate, for example) for all loans over $25,000. A lack of collateral doesn't mean a loan application will be denied, but any borrower will be required to "pledge collateral that is available."
“SBA is strongly committed to providing the most effective and customer-focused response possible to assist Minnesota small businesses with federal disaster loans. We will be swift in our efforts to help these small businesses recover from the financial impacts of the Coronavirus,” said SBA Administrator Jovita Carranza
Get more information on the application process from a fact sheet here. You can also call the SBA Disaster Assistance Customer Service Center at 1-800-659-2955.
Facebook is also in the process of launching a program that will help up to 30,000 small businesses around the world with $100 million worth of cash grants and Facebook advertising credits. Learn more about the program here.