President Joe Biden issued a proclamation Sept. 10 declaring Sept. 12-18 as National Small Business Week.
“During National Small Business Week, we celebrate our nation’s small businesses — the pillars of their neighborhoods,” the proclamation stated.
Biden announced a governmentwide goal to grow Federal contracting with small, disadvantaged businesses by 50 percent, translating into an additional $100 billion over five years.
“By ensuring that more disadvantaged small businesses can compete for and win federal contracts, we can boost job opportunities and economic prosperity in every corner of America,” Biden said.
In addition, U.S. Small Business Administration announced enhancements to the the COVID Economic Injury Disaster Loan (EIDL) program, a federal disaster relief loan designed to better serve and support small business communities, especially hard-hit sectors such as restaurants, gyms and hotels.
The SBA is ready to receive new applications immediately from small businesses looking to take advantage of these new policy changes, SBA Administrator Isabella Casillas Guzman said.
“We’ve retooled this critical program — increasing the borrowing limit to $2 million, offering 24 months of deferment, and expanding flexibility to allow borrowers to pay down higher-interest business debt,” Guzman said.
“We have also ramped up our outreach efforts to ensure we’re connecting with our smallest businesses as well as those from low-income communities who may also be eligible for the companion COVID EIDL Targeted Advance and Supplemental Advance grants totaling up to $15,000,” she said.
Key changes being announced by the SBA include:
- Increasing the COVID EIDL cap. The SBA will lift the COVID EIDL cap from $500,000 to $2 million. Loan funds can be used for any normal operating expenses and working capital, including payroll, purchasing equipment, and paying debt.
- Implementation of a deferred payment period. The SBA will ensure small business owners will not have to begin COVID EIDL repayment until two years after loan origination so that they can get through the pandemic without having to worry about making ends meet.
- Establishment of a 30-day exclusivity window. To ensure Main Street businesses have additional time to access these funds, the SBA will implement a 30-day exclusivity window of approving and disbursing funds for loans of $500,000 or less. Approval and disbursement of loans over $500,000 will begin after the 30-day period.
- Expansion of eligible use of funds. COVID EIDL funds will now be eligible to prepay commercial debt and make payments on federal business debt.
- Simplification of affiliation requirements. To ease the COVID EIDL application process for small businesses, the SBA has established more simplified affiliation requirements to model those of the Restaurant Revitalization Fund.
The enhancements to the COVID EIDL program will allow more businesses greater and more flexible support from more than $150 billion in available COVID EIDL funds, Guzman said. These changes will also help entrepreneurs access capital at a time when, according to a recent Goldman Sachs 10,000 Small Businesses survey, 44 percent of small business owners report having less than three months of cash reserves, and only 31 percent reporting confidence in gaining access to funding.
Eligible small businesses, nonprofits, and agricultural businesses in all U.S. states and territories can apply for the EIDL loans through Dec. 31, but applicants are urged to file their applications as soon as possible.
Visit sba.gov/eidl to learn more about eligibility and application requirements.
For additional information on COVID EIDL and other recovery programs, visit sba.gov/relief.
To celebrate the 2021 National Small Business Week, the SBA is hosting a three-day virtual summit beginning today, Sept. 13.
This year’s National Small Business Week virtual conference will offer free educational webinars, free business advice and an opportunity to network with fellow business owners.
Registration is required; individuals interested in the conference can register here.