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How Do I Apply for the Coronavirus Small Business Loan?

To help SMBs operate during the coronavirus outbreak, Trump has instructed the SBA to provide low-interest loans to small businesses

In an address to the nation on Wednesday, President Trump announced the government’s plan to help sole proprietors and small and medium-sized businesses (SMBs) in response to the coronavirus outbreak.

The administration’s plan is two-fold:

- Provide small business loans to organizations impacted by economic slowdown as a result of the coronavirus

- To provide an immediate, 3-month tax holiday for businesses

SBA loans available for businesses impacted by COVID-19

To help SMBs operate during the pandemic, Trump has instructed the Small Business Administration (SBA) to “provide liquidity to states and small business owners” with low-interest loans.

He has asked Congress to increase funding to the Small Business Administration by $50 billion. That level of funding will provide the SBA with more than double the amount of loans it made in fiscal year 2019.

When revenue is uncertain, many business owners look for cash on hand to weather the storm.


The loans will help SMBs meet payroll; stay liquid during drops in customer demand or delayed payments; and look for alternatives or manage supply chain issues.

Currently, New York City and Washington state are most affected by the virus, but more locations are declaring a “state of emergency” in response to the outbreak. These declarations allow localities to access federal emergency funding.

The travel and hospitality industries – including restaurants, hotels, and entertainment venues – will be hit the hardest by the coronavirus outbreak. SMBs that supply goods and services to these industries will likely feel the ripple effect of COVID-19.

Small agricultural cooperatives are also being targeted as potential impacted industries and SBA loan beneficiaries, if needed.

How to apply and qualify for the SBA coronavirus relief loan

The Small Business Administration announced it’s working directly with state governors to provide targeted, low-interest loans to nonprofits and small businesses impacted by COVID-19.

Their established Economic Injury Disaster Loan (EIDL) program will provide working capital loans up to $2 million for economic support and help overcome temporary revenue loss during the outbreak.


To begin, a county needs to be approved by the SBA for an Economic Loss Declaration, a request submitted by the governor.

Once declared, economic injury assistance will be available to businesses within that county, as well as contiguous counties around the declared county.

Once a declaration is made for designated counties, information to apply for Economic Injury Disaster Loan (EIDL) assistance will be made available to all applicable communities.

The fine print of the coronavirus loan program

The SBA will provide financial assistance only to businesses that are otherwise unable to secure loan funding.

Washington State Congressman Rick Larsen issued a fact sheet about the loans. The loan amount is determined by the small business or independent business owner’s actual “economic injury and financial needs.”

Interest rates for EIDL loans are set at:

3.75% for small businesses

2.75% for nonprofits

Loan repayment can extend up to 30 years. The SBA’s terms and conditions are determined by the business’ ability to repay the loan.

How businesses can help with the loan process

To be eligible for assistance, counties must be approved by the SBA for impact and potential relief.

To do so, localities must provide the SBA with documentation supporting the economic impact of COVID-19 in their area. Many counties are already posting the Small Business Administration Estimated Disaster Economic Injury Worksheet For Businesses form on their websites to get the process started.

Small business owners should check county websites to see if the form is being made available, and to whom they should return the document.

These voluntary forms help county officials and Departments of Emergency Management assess damages and the need throughout their area.

County officials will submit the forms and other information to request an Economic Injury Disaster Loan Declaration.

Once approved, EIDL loan processing can begin. Additional information may also be found on county and local websites about other resources and relief being offered.

Tax holiday for businesses in wake of coronavirus

In addition to opening up loans for SMBs, Trump announced a tax holiday for businesses. The plan will allow business owners to delay paying taxes normally due on April 15 for 90 days without interest or penalty. It is estimated the tax deferral will add $200 billion to the U.S. economy, providing a boost to keep the nation moving forward.

Many states and cities are considering following suit.

San Francisco Mayor London Breed announced businesses with up to $10 million in gross receipts may defer their April 30 quarterly tax payment until February of 2021 if necessary.

Additional measures are being considered on the federal level to assist workers and business owners.

“This is not a financial crisis,” Trump said, in an effort to calm fears. “This is just a temporary moment of time that we will overcome as a nation and as a world.”


Riia O'Donnell

Riia O’Donnell is a Human Resource professional with over 15 years of hands-on experience in every discipline of the field. A subject matter expert, she has written for the online HR market for over 8 years. Her first job, at age 15, was working the early morning shift at a local bakery on weekends.