Small businesses that have been impacted by the COVID-19 pandemic still have time to apply for long term, low interest Economic Injury Disaster Loans (EIDL) from the U.S. Small Business Administration. These working capital loans provide a maximum of $500,000 for small businesses to use to offset economic injury experienced during the pandemic. Proceeds of the loan may be used for credit card payments, increased wages, accumulated rent, increased cost of goods sold, and more.
The SBA has taken measures to improve the EIDL application and approval process. In late June, the COVID EIDL Loan Program was transitioned from the Office of Disaster Assistance to the Office of Capital Access (OCA). This transition included implementing new processes and performance management, and dedicating additional personnel to increase capacity of the review process. This transition resulted in daily processing of EIDL increases of 1,647 on June 28th to 37,027 on July 28th – a 22-fold increase in production efficiency. The SBA estimates that the current 600,000+ loan modification backlog to be cleared by mid-August, with most reviewed by early August.
The SBA has also invested in an improved customer service experience for COVID EIDL applicants which includes more than doubling capacity, enhancing standards and response quality, and developing application completion support. The SBA will also be providing enhanced outreach efforts to deliver COVID EIDL program information to all communities, including socio-economically disadvantaged communities via partnerships, webinars and train the trainer series.
Leon Milobar, Acting Region VII Administrator and SBA Nebraska District Director, states that “the COVID EIDL disaster program is an opportunity for a business to access long term capital at historically low rates as business activity resumes if their credit score is at least 570. Processing times for applications have been vastly improved, and the loan amount has increased up to $500,000 subject to approval.”
Milobar encourages business owners in Nebraska to apply well ahead of the December 31st application deadline as funding may run out prior to that date. The online application can be access through this link: www.sba.gov/eidl
Business owners interested in learning more about the COVID EIDL program should review the FAQ located on SBA’s website: https://www.sba.gov/document/support-faq-regarding-covid-19-eidl.