During mid-March a flurry of announcements from the White House, U.S. Treasury, and the Small Business Administration (SBA) hailed the first measures being taken to address the economic challenges faced by small businesses and entrepreneurs across the country.
With access to credit and lending markets having practically dried up during the current economic crisis, small businesses, a sector that has created about 70 percent of all new jobs in the past decade, are now getting targeted help.
Here are some facts about what the American Recovery and Reinvestment Act (ARRA) means for small businesses at this point in time, as well as resources to help you find out more about how you can take advantage of the ARRA for your small business growth.
The Recovery Act and Small Business Loans
As a result of the Recovery Act, the SBA recently announced changes to its lending and investment programs that will make it easier and less expensive for more small businesses to get the financing they need.
The agency will receive $730 million in ARRA funds, the allocation of which is outlined on the SBA’s Recovery Act Web portal here.
Specifically, small businesses can already benefit from two key provisions that were laid out in the Recovery Act – the temporary elimination of certain loan fees and the raising of guarantees on some 7(a) loans of up to 90 percent.
The elimination of loan fees, announced on March 16, will remain in effect until the end of the calendar year or until the funding is exhausted. The elimination of fees is retroactive to the day the Recovery Act was signed into law.
SBA has published a Q&A about the new changes: Recovery Act Frequently Asked Questions for Small Business Owners.
Find Out how this Affects your Business
There are many events and seminars taking place in local business communities across the country to educate small business owners about these changes to SBA loan programs. These include:
- In-Person Seminars
Many banks and lenders are also hosting sessions to help small businesses understand the implications of the Recovery Act on business financing.
Business.gov also regularly “Twitters” about upcoming SBA-related seminars. Follow them @businessdotgov.
- Web Events
There are also many online resources including the SBA’s monthly Web chats, which invite questions from the small business community on topical matters.
- Discussion Boards
More details on the SBA’s implementation of the Recovery Act funds will be coming over the next few weeks. Bookmark the SBA’s Recovery Act Web portal here for more updates.
- Recovery.gov – Read the ARRA, see how the money is being spent, and more.
- Small Business Loans Guide from Business.gov – Information about the various small business loans available including loans for starting and expanding your business, disaster loans, export assistance loans, veteran and military community loans, and special purpose loans.
- Loans and Grants Tool – Find loans and grants for your small business easily and quickly with this Loans and Grants Tool.