LAST UPDATED: 4/1/2020 at 12:08pm
First off, we hope this message finds you and your families safe and healthy.
Next, we will be periodically updating this post as we learn more information so that customers have as much information as possible. You can check the "last updated" info, above, for when the last update was made, and we'll note any new information with an "Update" tag at the beginning of the new info. In addition, if anyone has information of their own to share, PLEASE feel free to leave a comment as I'm sure we'd all appreciate any additional insight.
Like most of you, we’ve had to make some adjustments to our business during these trying times.
The first and most important thing we did was ensure we continued to provide the same level of service to our customers. While we’ve transitioned to working from home, we’ve also extended our office hours to increase our availability for customers. We will be making these changes permanent until June 1st at which time we will need to re-evaluate.
Like many of you, we are also evaluating our financial obligations to our integration partners, vendors and service providers and, most importantly, our employees. We are making every effort to be as lean and efficient as possible during these difficult times.
Thankfully, political leaders in the U.S. put their differences aside and approved legislation that offers some financial relief to small and medium businesses like ours, businesses that are feeling a financial impact as the world economy slows and adjusts to this new and different point in time.
It has been and always will be our desire to help our customers as much as possible. Because our products are critical communication and collaboration components for many of our customers, we want to assure you all that we are doing everything we can to minimize any disruptions to the services we offer, and still provide new and exciting releases during these times.
With that said, we would also like to share some information we believe may benefit our US customers. However, please understand that this is for informational purposes only and should not be taken as any form of financial or legal advice.
Paycheck Protection Program (PPP) Loans
This loan is essentially to help any small business retain employees and be able to continue paying them during the crisis. The loan can be used for payroll and any payroll expenses (e.g., health care, retirement benefits, etc.) as well as for things like rent and utilities. There is a low maximum interest rate of 4%, and the maximum loan period is up to 10 years, with an initial deferment for starting to repay the loan for up to 6 months. These loans are also offered without the need for collateral or a personal guarantee.
In addition, if certain terms are met, the entire amount of the loan can be “forgiven”, meaning it’s not necessary for the business to pay it back. In order to apply for a PPP loan, it’s necessary to go through an SBA-approved lender, such as a bank. Below are some links for more information:
SBA.gov Paycheck Protection Program page
Forbes.com article giving more details on the PPP loan program
UPDATE: the SBA.gov site now has a dedicated PPP page. That page provides more information about the PPP loan program and also includes a sample application that you can review. However, you WILL want to check with an SBA-approved lender as this is simply a sample application. In addition, it looks like there are some dates available for when these loan applications will start becoming available. Per OneDigital (a firm we use for HR consulting):
- Starting April 3, 2020, small businesses and sole proprietorships can apply for and receive loans to cover their payroll and other certain expenses through existing SBA lenders.
- Starting April 10, 2020, independent contractors and self-employed individuals can apply for and receive loans to cover their payroll and other certain expenses through existing SBA lenders.
- Other regulated lenders will be available to make these loans as soon as they are approved and enrolled in the program.
Economic Injury Disaster Loan (EIDL)
This is a more comprehensive loan that can be applied for directly through the Small Business Administration, though the loan is funded through an SBA-approved lender. This loan has a “loan advance”, or Grant, piece to it that offers a $10,000 advance on the loan amount within 3 days of the submission of the application. COVID-19 was added as a disaster that’s covered by the SBA’s standard disaster assistance loan and is available to both businesses and homeowners.
From what we’re seeing the loan amounts can be up to $2 million, have a 30 year term and have low interest rates depending on whether you’re a small business or non-profit, and the first month’s payment is deferred a full year from the date of the loans origination. While the loan amount and terms are different, an EIDL is an option available to anyone who is interested. Below are some links for more information:
SBA.gov Economic Injury Disaster Loan page
Forbes.com article giving more details on the EIDL as well as the PPP
These are just 2 of the ways the SBA is helping businesses impacted by COVID-19. They also offer other programs, such as SBA Debt Relief for new and existing SBA loans, an Express Bridge Loan program for businesses that have a pre-existing relationship with an SBA lender, and more. For information on all the options available, visit the SBA COVID-19 Small Business Guidance and Loan Resources page.
We’re all living through an interesting time in history. It can be difficult, but by coming together, and working together, we can all weather the storm and we’ll come out on the other side much stronger. We hope you find this information useful.
We wish we had the resources to understand the economic stimulus options available for customers in other countries. If you want to share what you know, we're sure other customers would appreciate the information.
Thank you ALL for being SmarterTools customers!
The Entire SmarterTools Team