What Is a PPP loan?
Due to COVID-19, many businesses faced an economic disruption and were forced to temporarily close. This put their employees’ paychecks in jeopardy. To provide support for these businesses and to ensure no disruption to employees’ paychecks, the U.S. Small Business Administration (SBA) began issuing Paycheck Protection Program (PPP) loans. The PPP loan aimed for small businesses to keep workers on payroll or rehire workers that were laid off due to COVID-19. Other PPP qualified expenses include electricity, gas, water, transportation, rent and more that are related to COVID-19 relief efforts. The PPP program ended on May 31, 2021. However, it is important to stay educated on what a PPP loan is. This can be beneficial in the event where another opportunity arises or for you to be aware of your other options.
Are You Eligible for a PPP Loan?
The Paycheck Protection Program loan has been available for all businesses with 500 or fewer employees (with some exceptions to more employees). This included , but did not limit to nonprofits, self-employed individuals, independent contractors, sole proprietorships, food services and veteran organizations. Other eligibility terms provided by the SBA states that your business was operational before or starting on February 15, 2020, and that your business is currently open and operating again.
How Can It Benefit Your Business?
Trying to get back on your feet during a global pandemic is extremely difficult. Taking out a loan can be discouraging and a scary decision to make. Fortunately, the PPP loan has benefits that many other loans do not. This makes it easier for you to get back on your feet. For example, the PPP interest rate is only 1% per year and you can apply for loan forgiveness within ten months from the end of your covered period. As long as you follow the specific guidelines on spending your PPP loan, you can achieve 100% loan forgiveness. PPP loans do not require any collateral and can give your business the support and capital it needs to continue growing strong.
What to Do If You Cannot Obtain a PPP Loan
Overall, a PPP loan can be a great option to keep your business moving. Staying on top of your finances is essential for a long-lasting successful business. If you find yourself disqualified from any of these terms or if you miss the deadlines, do not worry. You can explore support from alternative funding companies like CapFlow Funding Group, and still attain working capital. CapFlow Funding Group provides businesses an immediate influx of working capital. We offer companies the opportunity to bypass the wait of getting invoices paid. If you are experiencing a slow time due to COVID-19 or want to continue growing your business, this can be an advantageous for you. CapFlow has provided $1 billion in working capital to businesses and you can be part of that!