Small-Business Loans Expected to Start Friday, Mnuchin Says - The Wall Street Journal

Small-Business Loans Expected to Start Friday, Mnuchin Says - The Wall Street Journal


Small-Business Loans Expected to Start Friday, Mnuchin Says - The Wall Street Journal

Posted: 30 Mar 2020 08:16 AM PDT

Treasury Secretary Steven Mnuchin says the Treasury Department hoped to release instructions Monday on how businesses can apply for the funds.

Photo: Patrick Semansky/Associated Press

WASHINGTON—Treasury Secretary Steven Mnuchin said he expects details will be released later Monday on how small businesses disrupted by the coronavirus pandemic can tap a new loan program Congress passed last week.

The roughly $2 trillion economic relief package President Trump signed into law Friday includes nearly $350 billion in loans for companies with fewer than 500 employees, which will be administered by the Small Business Administration.

Mr. Mnuchin said in an interview with Fox Business Network he expected the loans to be available starting Friday, "which will be at lightning speed."

He said the Treasury Department hoped to release documents and instructions later Monday on how businesses can apply for the funds. Small-business owners can go to any of the existing SBA lenders, as well as any FDIC-insured institution, credit union or financial-technology lender that has signed up for the program, he said.

"We expect this will be very, very easy," he said.

If the program is successful officials will go back to Congress to ask for more money, he said.

President Trump signed an historic $2 trillion bill into law Friday aimed at relieving workers and businesses hurt by the novel coronavirus pandemic. WSJ breaks down what is in the package. Photo: G. Ronald Lopez/ZUMA Wire

Write to Kate Davidson at kate.davidson@wsj.com

Copyright ©2019 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Treasury, SBA provide information on new small-business loan program | TheHill - The Hill

Posted: 31 Mar 2020 11:52 AM PDT

The Treasury Department and Small Business Administration (SBA) said Tuesday that they have launched an effort to mobilize banks and other lenders to distribute small-business loans authorized by the coronavirus relief law President TrumpDonald John TrumpIllinois governor says state has gotten 10 percent of medical equipments it's requested Biden leads Trump by 6 points in national poll Tesla offers ventilators free of cost to hospitals, Musk says MORE signed last week.

The coronavirus relief package created a nearly $350 billion program under which businesses with 500 or fewer employees can receive loans of up to $10 million. The loans will be forgiven if businesses use the funds to cover payroll costs and other operating expenses in the eight weeks following loan origination.

Treasury and the SBA both have launched webpages with information about the program. The SBA's webpage includes a link to the application form for borrowers and fact sheets about the program for both lenders and borrowers.

ADVERTISEMENT

Tuesday's announcement comes after Mnuchin said Monday that he hoped documents about the program would become available that day. Mnuchin reiterated on Tuesday that he expects businesses to be able to start to apply for and receive loans on Friday.

"This legislation provides small business job retention loans to provide eight weeks of payroll and certain overhead to keep workers employed," Mnuchin said in a statement. "Treasury and the Small Business Administration expect to have this program up and running by April 3rd so that businesses can go to a participating SBA 7(a) lender, bank, or credit union, apply for a loan, and be approved on the same day."

Treasury's fact sheet for borrowers states that small businesses and sole proprietorships will be able to start applying for loans on Friday through existing SBA lenders, and self-employed people and independent contractors will be able to start applying for loans through existing SBA lenders on April 10. Other lenders will be able to start to make loans through the program once they are approved.

"This unprecedented public-private partnership is going to assist small businesses with accessing capital quickly," SBA Administrator Jovita Carranza said. "Our goal is to position lenders as the single point-of-contact for small businesses – the application, loan processing, and disbursement of funds will all be administered at the community level."

The small-business loan program is one of several aspects of the new coronavirus relief law that Treasury has been providing information about in recent days. Other areas of the package that Treasury has been working to implement include direct payments to individuals, a new tax credit designed to encourage businesses to retain their workers and aid to the airline industry.

Updated at 3:17 p.m.

Pelosi asks Trump administration to protect start-ups suffering from the coronavirus crisis - CNBC

Posted: 31 Mar 2020 12:56 PM PDT

Reps. Ro Khanna and Nancy Pelosi

Michael Brochstein | Echoes Wire | Barcroft Media via Getty Images; Erin Scott | Reuters

House Speaker Nancy Pelosi and Rep. Ro Khanna, who represents a large part of Silicon Valley, are asking the Trump administration to protect start-ups as it carries out relief payments for small businesses under the CARES Act.

The California Democrats wrote to Treasury Secretary Steven Mnuchin and Small Business Administrator Jovita Carranza on Tuesday to warn that a narrow interpretation of the relief recipients could hurt Silicon Valley companies. They wrote that "an overly strict application" of an SBA rule could exclude many businesses from eligibility for the relief bill's Paycheck Protection Program, which is meant to help cover costs for small businesses through the crisis. 

Khanna explained on Twitter on Saturday that even though most start-ups have fewer than 500 employees, the SBA may not view them as small businesses if they are backed by venture capital. The SBA considers all start-ups backed by a venture capital firm as being part of the same business.This criteria would bar many emerging and early-stage businesses from aid.

Pelosi and Khanna wrote that Silicon Valley start-ups make vital contributions to the economy and should have access to relief provided in the bill.

"Startups are the engine of America's innovation economy and our districts in California's Bay Area and Silicon Valley are home to thousands of these companies," they wrote. "Other high-tech hubs around the country with a strong startup ecosystem will also be in need of PPP financing to preserve jobs and survive."

Representatives for the Treasury Department and the SBA did not immediately respond to a request for comment.

WATCH: Why the coronavirus probably won't force American grocers to run out of food

Comments

Popular posts from this blog

COVID-19: New business ideas emerge as people work from home - The Jakarta Post - Jakarta Post

5 Last-Minute Ideas for a Successful Small Business Saturday - Entrepreneur

6 Ways to Improve Your Small Business SEO in 2020 - Entrepreneur