The $2 trillion stimulus package passed by Congress late Wednesday, which includes more than $370 billion for tiny businesses could bring much-needed help. The bill will allow banks to lend directly to businesses, as well as also those loans will be backed by the tiny Business Administration. as well as also although there are restrictions, some of the terms are less onerous than some other programs administered by the S.B.A.
yet This specific could take at least two weeks after the bill will be signed into law for the money to begin flowing, as well as also for tiny business owners — many of whom operate on thin margins — delays could mean the difference between surviving as well as also shuttering their businesses permanently.
Every day counts for Glynis Donnelly, who owns a jewelry store in Tampa, Fla. Ever since the coronavirus outbreak decimated foot traffic to her store, she has been using her savings to pay her eight part-time employees.
“This specific may not be the most business-smart thing to do,” Ms. Donnelly said, “yet I know my employees very well, as well as also I know that will they need me as much as I need them.”
Federal authorities know time will be tight. Regulators on Thursday released a statement encouraging banks as well as also credit unions to start creating tiny loans to individuals as well as also tiny businesses immediately, independent of the stimulus.
The stimulus package will be offering tiny businesses S.B.A.-backed loans to pay for basic expenses. They might not have to repay portions that will were spent on paying employees, a mortgage, rent or utilities. The banks lending the money might be reimbursed for those portions by the Treasury Department, which will be receiving $377 billion to fund the program.
The bill will be the latest effort by the federal government to prevent the widespread decimation of tiny businesses as the virus, which will be still spreading, forces people indoors. An earlier stimulus package offered special loans to cover employees’ benefits along with utilities as well as also some other necessities while businesses were closed. Modeled after a disaster relief function inside the S.B.A., This specific requires applicants to deal directly with the tiny agency.
yet the S.B.A.’s website has been so jammed that will many users have been unable to complete loan applications, as well as also those who did are told that will they will take at least three weeks to process.
Michael Muscarella, who runs Dog Services, a kennel in Richmond, Va., plans to apply to fund his payroll. In late January, he as well as also his partners met to prepare for the coronavirus outbreak as well as also decided to pay employees through the end of April.
The business employs as many as 60 people as well as also pays $14 an hour. Mr. Muscarella said he might use a loan to give low-wage employees an incentive not to abandon their jobs, as home delivery services like Amazon as well as also GrubHub begin to lure workers away.
“I’ve got to find a way to keep them loyal to me,” he said.