Last Friday, May 15, the SBA issued new guidance for PPP loan forgiveness, and also published the official SBA PPP Loan Forgiveness Application (SBA Form 3508). We immediately went to work updating our free guide and calculator. Today, we’re releasing our new guide and an updated version of our free calculator. These tools will be helpful as you prepare to submit your PPP Loan Forgiveness application to the SBA through your lender.

Updated Guide and Calculator

Our SBA PPP Loan Forgiveness guide and calculator are absolutely free, and you can download them by going to this page. We’ve created a Microsoft Excel version and a Google Sheets version of the calculator. The guide is a 4-page PDF. Get them both here.

What Changed?

The Community Bankers Association of Georgia has a good update here. To sum up the major changes, other than the issuance of the actual application, here are the pertinent bullet points from that CBA of GA article.
  • Options for borrowers to calculate payroll costs using an “alternative payroll covered period” that aligns with borrowers’ regular payroll cycles, as opposed to exactly 8 weeks from the day you received funding.
  • Flexibility to include eligible payroll and non-payroll expenses paid or incurred during the eight-week period after borrowers received their PPP loan.
  • Step-by-step instructions on how to perform the calculations required by the CARES Act to confirm eligibility for loan forgiveness.
  • Statutory exemptions from loan forgiveness reduction based on rehiring by June 30.
  • The new exemption for borrowers whose good-faith, written offers to rehire workers were declined.

What’s the PPP Loan Forgiveness Application Look Like?

You can download that document (PDF) here. To sum it up, it looks a lot like a 1040 tax return. That’s good news for our accountants, whose job it is to help us work through forms like this one, but it’s bad news for anyone who thought they could do it themselves. The application is complex, which is why we’ve done the following:
  • Created a guide, much clearer than the official SBA instructions. You can see those for yourself here.
  • Created a calculator that will help you prepare to complete your official application.
  • Vetted thousands of accountants, and set up a simple matching process for any small business to find the right accountant in a few steps.

What Happens Next?

We expect the SBA to continue updating its guidance for PPP loan forgiveness as more and more businesses get funding and then begin the forgiveness application process. We encourage everyone who received a PPP loan to go ahead and download the SBA forgiveness application, so you can begin to prepare (or find an accountant for help). Eight weeks after you received your PPP loan, you will have most of the data that you’ll need to complete your forgiveness application. However, we also encourage everyone who received a PPP loan not to wait, but rather to keep accurate and up to date information on your payroll costs and other necessary payments that fall under the acceptable forgiveness uses for your PPP loan. If you are like most people, you will need help from your accountant. We encourage you to invite your accountant to join our network and help you complete and submit your PPP forgiveness application through your bank via our portal. Invite your accountant here or find a virtual accountant here.
The Federal Reserve program will provide additional coronavirus relief for small and midsize businesses with deferred loan payments and low-interest loans for the first year. By FINSYNC  If you’re like most small businesses out there facing the current economic downturn, government stimulus plans like the $2 trillion CARES Act can be a lifeline. Unfortunately, many small businesses missed out on the popular Paycheck Protection Program (PPP). Though the start date has yet to be released, the Main Street Lending Program will provide additional relief to small and midsize businesses affected by the pandemic in the form of low-interest business loans. 

How is the Main Street Lending Program Different Than PPP?

Unlike PPP, which was administered by the Small Business Administration (SBA), the Federal Reserve’s Main Street Lending Program is not a grant — you’ll have to pay it back. The program will function more like a traditional loan. However, interest rates will be low and payments and interest will be deferred for the first year. There will also be fewer restrictions on what you can use the money for. Better yet, the money won’t run out.  Federal Reserve Chairman, Jerome Powell, describes the program: “These are not grants, these are loans. The second thing is, [the Federal Reserve] won’t run out of money. It’s not a limited pot, so there won’t be this incentive to try to get there first.” While the Federal Reserve is enabling an initial $600 billion in loans, additional funding may be available as necessary.  The loan terms and interest rate are also different than PPP loans, which feature a fixed 1% interest rate and two-year term. Main Street loans will have a four-year term, and an interest rate equal to LIBOR +3%.

Who is Eligible for Main Street Lending?

Did you secure a PPP loan? Good news! If your business is eligible, you can still apply for a Main Street loan.   For-profit U.S. businesses with 15,000 or fewer employees — or revenues of $5 billion or less — can apply for Main Street loans (an increase from initial caps of 10,000 employees or $2.5 billion in annual revenue). There is no minimum size for a business to be eligible. Your business must have been established before March 13, 2020. Borrowers will also face more traditional eligibility criteria than PPP. Lenders will apply their own underwriting standards to evaluate the creditworthiness of borrowers, which may mean additional information and documentation requirements. While the SBA guaranteed 100% of PPP loans, Main Street lenders will retain either a 5% or 15% share of the loan, depending on loan type (see chart below), while the Fed will purchase the balance. Other key differences between the PPP and the Main Street Lending Program are the size of the loans and businesses who are likely to qualify. Unlike the PPP, which didn’t have a minimum loan amount, Main Street loans start at $500,000. And while PPP was only open to smaller businesses, the Main Street Lending Program is open to midsize businesses as well.

What are Permitted Uses for a Main Street Loan? 

Main Street loans can be used to ease any financial hardship caused by coronavirus. While there are less stringent use requirements than the PPP, guidelines state that you must use the loan to make “reasonable efforts” to maintain payroll and retain employees.  You may not use Main street loans to pay off existing debt (including a PPP loan). You may not refinance, or pay dividends or distributions to pay yourself during the loan term, or for 12 months after it’s paid off. As a business owner, you may pay distributions to make tax payments.

How Can I Apply for a Main Street Loan?

The start date of the loan program has yet to be announced. The Federal Reserve released the initial term sheet on April 9, 2020, followed by revised term sheets and additional guidance on April 30, 2020.  In light of the challenges with the PPP, the Fed is trying to avoid similar issues with the Main Street program, hence the revised terms and additional guidance mentioned above. The Fed responded to feedback and significantly expanded the program to offer more loan options to more businesses.  Once applications are being accepted, eligible borrowers can apply through an eligible lender, which currently includes banks, savings associations and credit unions. Application requirements will vary by lender. You do not technically need to have an existing relationship with the lender in order to apply, but it remains to be seen how many institutions will offer this type of credit to businesses with whom they have no history.

Main Street Loan Details

The Main Street Lending Program consists of three secured or unsecured loan facilities: the Main Street New Loan Facility (MSNLF), the Main Street Priority Loan Facility (MSPLF) and the Main Street Expanded Loan Facility (MSELF).  All three types of loans will have a four-year term and a variable interest rate equal to LIBOR +3%. Payments of principal and interest are deferred for one year. Borrowers can prepay without penalty. Loan amounts range from $500,000 to $200 million.  The three loans are different when it comes to origination fees, the level of guarantee by the federal government, and the loan’s relationship with existing debt. Looking for a Low-Interest Loan? Main Street Lending Program May Deliver Soon                    Source: U.S. Chamber of Commerce Guide to the Main Street Lending Program

Assess Your Loan Options Now

The Main Street Lending Program is expected to start in a matter of weeks. While there shouldn’t be a rush to apply before the money runs out, as with the PPP, it’s a good idea to assess your options now so you’re prepared to apply once funding is available. Start by checking with your lender (and others) to find out if they plan to offer Main Street loans.
FINSYNC is helping the businesses who received funding from SBA’s PPP loan by offering them a free forgiveness guide, forgiveness calculator, and access to a network of accounting professionals who are trained to help if one has questions or needs assistance.   For the banks and credit unions that made PPP loans, FINSYNC is providing a portal through which all of their business customers can upload forgiveness calculations and supporting documentation. Our goal is to help lenders process forgiveness applications efficiently, and offer automated uploading to SBA’s ETran when that becomes available.

Download the PPP Forgiveness Calculator here

The Payroll Protection Program (PPP) funded more than 1.6 million small businesses across the country earlier in April. The second round (PPP2) is (as of this writing) funding hundreds of thousands more small businesses with 2.5 months of payroll costs. The administrative hurdles to apply for a PPP loan were fairly low, although the competition to get a loan was very high. The first PPP money ran out in 14 days. Round 2 is expected to last hours instead of days. Perhaps there will be a 3rd round, but we don’t know that yet. In the meantime, approximately 3 million businesses will have what amounts to ‘free money’ to help them stay afloat and keep employees on the payroll. Then the fun of forgiveness tracking starts.

What Is Forgiveness Tracking?

When Congress created the CARES Act, the PPP provision stated that these loans could be 100% forgiven. The stipulations behind forgiveness are mostly clear. Up to 100% of the principal amount of the loan may be forgiven if:
  • You use the proceeds on qualified expenses. Such as maintaining support for at least the number of jobs you had when applying, and funds were used for:
    • Payroll costs (excluding 1099 contractors)
    • Group health insurance benefits, paid sick leave, medical and insurance premiums
    • Mortgage or rent payments
    • Utilities
    • Interest on any other debt obligations that were incurred before the loan period
  • At least 75% of the amount used must be for payroll to qualify for maximum forgiveness, the remainder may be used for other qualifying expenses.
  • To qualify for forgiveness, expenditures for both payroll and other expenses must occur within 8 weeks of receiving the loan (aka, the funding date)
Those are the requirements. The “tracking” portion of the equation about tracking, documenting, and proving to your lender and the SBA that you did indeed use the money for these purposes.

How Is PPP Spending Verified?

The PPP loans require payments to begin 6 months after the funding date. In order not to have to make any payments, the borrower must submit documentation to their bank. The bank must then certify that they have reviewed the documentation, and then submit the documents and their certification to the SBA. The problem is, there’s no standard for documentation, nor the collection and submission of that documentation. That’s why we put our heads down and built a calculator for any business to track their PPP expenditures and why we’ll soon be launching our PPP Forgiveness Tracking App, so businesses can submit and banks can easily accept, track, certify, and submit forgiveness documentation to the SBA. The FINSYNC PPP Forgiveness Calculator includes:
  • A complete guide to forgiveness requirements
  • Thorough instructions on using the calculator
  • A straightforward worksheet to help you calculate your forgiveness amount
  • An example of a completed forgiveness calculation 

Get the free PPP Forgiveness Calculator here

The first round of PPP loan funding was used up in 14 days. Now, Congress is set to pass a second round of PPP funding. We’ll refer to as “PPP2”. There are a few changes to the rules surrounding PPP2, and we explain those below. However, we’ve been busy enhancing our PPP loan application, and have made partnerships that will help you and your small business get the PPP funding you need to stay afloat through this pandemic.

The $60B Community Bank Carve Out

PPP2 contains a provision that sets aside $60 billion for loans only from lenders with less than $10 billion in assets, meaning small community banks. Now those lenders will not be blocked out by the huge banks getting there first and taking the max loan amount for their much larger clients.

Small Businesses: Apply for PPP2 at FINSYNC.com. We’ll Find You a Lender

We’ve built a complete PPP application — complete with tools for calculating your average monthly payroll costs and loan forgiveness tracking. We’re sharing our application with any and all community banks and credit unions for free. If your institution is in our network of lenders, we will connect your application directly to them. If not, we will connect you with a lender who can service your loan.  The FINSYNC PPP application will provide your business with everything required for PPP compliance up to and including a tool for loan forgiveness tracking. Many small businesses applied for PPP loans and either didn’t get approved or didn’t hear anything at all back from their bank. Our online application is now connected to SBA’s ETran system, so banks and credit unions that partner with FINSYNC know within a few seconds whether your application was accepted and approved.

Apply Now

Lenders: Use the FINSYNC Online Application to Speed Up Your Process

Many lenders processed all their PPP applications manually. That’s ok, but it’s slower than a computer can process information. PPP2, just like PPP, is “first come first served”, so speed matters.  Any lender can get our online application up and running for their business customers in just a few minutes. Eliminating manual processing, and submitting the application into the SBA ETran system. The result is faster funding for small businesses.

Lenders Get Started

Changes from PPP to PPP2

The first round of PPP had its issues, so Congress has made some changes to PPP2.
  • Businesses can apply to more than one lender.
  • Businesses are not required to have an account and/or a loan with the bank with which they apply.
  • Self-employed and Independent Contractors can apply as soon as funding opens. As opposed to a week after funding was available for PPP.
  • $60 billion is allotted to smaller financial institutions. Those with $10 billion or less in assets will get $30 billion and another $30 billion will go to banks with $10 billion to $50 billion in assets.
The original intent of the PPP program was to help small businesses, and the changes to PPP2 better align with that intention.

Businesses Apply for PPP2 here.

Lenders sign up to use the FINSYNC Online Application here.

Banks like First Reliance are finding a faster, easier way to serve their business clients by teaming up with FINSYNC to process Paycheck Protection Program loan (PPP loan) applications online. By FINSYNC From the moment the government earmarked $349 billion in payroll relief (rumored to be expanded with another $250 billion) and flipped the switch for small businesses to start borrowing, banks of all sizes were overwhelmed with Paycheck Protection Program loan applications. Meanwhile, the federal government’s guidance about how these loans should be administered has been, at best, confusing. Needless to say, the Paycheck Protection Program is popular. Banks should expect nearly all of their small business clients to apply in the next round. If they haven’t already. As of April 16th, the SBA has approved 100% of the initial $349 billion allocated to PPP. An additional $250 billion in relief may be released in the coming days. With a new massive influx of funding on the horizon, the volume of PPP loan applications shows no signs of slowing as small businesses rush to secure relief in the form of forgiven payroll loans. How can banks meet the needs of their small business clients and efficiently process this unprecedented flood of loan applications? We’ve got good news: Help is here.  Online PPP applications powered by Fintech solutions like FINSYNC can turn an overwhelming problem into an opportunity in a matter of 24 hours.

Streamline Loan Processing With Electronic PPP Applications

What if you could process PPP loan applications without piles of paperwork and various documents faxed, filed and emailed to keep track of? Online PPP loan applications powered by FINSYNC streamline the entire process for both you and your clients. First Reliance Bank, which serves the Carolinas, recently partnered with FINSYNC to offer its business clients an easy way to apply for PPP loans online. “We were looking for a way to serve our business clients with a streamlined solution for PPP applications that would allow our bank to efficiently process and get funding distributed,” said John Lindley, VP Business Operations at First Reliance Bank. “We deployed FINSYNC’s electronic loan application and Lender’s Portal the day we learned of the solution, and shortly after were getting SBA loan numbers and funding loans.” Up and running in just 24 hours, First Reliance Bank has already processed more than 80 loan applications. Read more about FINSYNC’s partnership with First Reliance Bank.

How FINSYNC Helps Financial Institutions Offer Online PPP Processing

In addition to giving banks and credit unions the ability to process Paycheck Protection Program loans online, FINSYNC’s solution significantly simplifies workflow and document management. The simple deployment process can be accomplished in as little as a day. All of the legwork is completed for you:
  • Get a link to the online application and Lender’s Portal
In a matter of minutes, FINSYNC assigns your financial institution a customized URL that links to the online loan application. You can use this URL immediately on your website, email communications, landing pages and anywhere you’d like to encourage your business clients to “Apply for Financing Online.” In addition, your institution will get its own Lender’s Portal. An underwriting workflow and analysis tool that lives in the Amazon Cloud. Where you can receive loan applications online.
  • Customers are approved for a PPP loan through your financial institution
Your business clients apply for financing online, submit electronic signatures on SBA documents, and upload required documents including proof of payroll costs. The loan offer is determined based on PPP criteria and results are automatically posted in your Lender’s Portal.
  • Finalize the application and automatically verify forgiveness eligibility
Once your client has submitted their PPP loan application online, you will receive an email alert that all documents are ready for your final review, approval and filing with the SBA. FINSYNC will provide free forgiveness eligibility tools shortly.

Electronic PPP Loan Processing Benefits Both Banks and Clients

As easy as FINSYNC makes it for banks and credit unions to process PPP loans online, the application process is equally simple for small businesses. Providing a streamlined loan application process will not go unnoticed by small business clients as they navigate these trying times. Once small business owners have gathered their payroll data and supporting documents, completing the online application generally takes less than 30 minutes. FINSYNC’s platform provides applicants with online calculators that help them confirm their eligibility. Also gives them access to trained advisors if they need additional help. Applicants sign all documents electronically and upload supporting documentation to expedite the application process. Funds are direct-deposited into the applicant’s account once the loan is approved. Your clients also get free access to FINSYNC’s cash flow analytics, and can track their loan forgiveness eligibility online.Is your financial institution ready for the next wave of PPP loan applications? Your small business clients are looking to you in this uncertain time. FINSYNC can help you deliver the help they need with a plug-and-play electronic loan application. Join FINSYNC’s Lending Network to get started.
This post was originally posted on BusinessWire.com. First Reliance Bank goes from signup to streamlined processing on the same day with FINSYNC’s free online loan application and lender’s portal.  ATLANTA, GA - April 15, 2020, FINSYNC, Inc., a leading provider of payment technologies and cash flow management software, is partnering with small and local lenders to provide their clients with significantly faster loan processing and funding for the SBA’s Payroll Protection Program (PPP) via a plug-and-play online loan application and Lender’s Portal. “Our PPP loan processing solution enables banks and credit unions to get more businesses funded quickly, and we are offering it at no charge,” said Eddie Davis, Sr. VP Sales & Operations. “FINSYNC’s plug-and-play solution can be deployed in minutes and makes life easier for businesses applying for funding, and for lenders that are processing their applications.”

First Reliance Bank Teams up With FINSYNC

Financial institutions like First Reliance Bank are partnering with FINSYNC to meet their small business clients’ needs and streamline the application process.  “We were looking for a way to serve our business clients with a streamlined solution for PPP applications that would allow our bank to efficiently process and get funding distributed,” said John Lindley, VP Business Operations at First Reliance Bank. “We deployed FINSYNC’s electronic loan application and Lender’s Portal the day we learned of the solution, and shortly after were getting SBA loan numbers and funding loans.”

Program Details

In addition to giving banks and credit unions the ability to process Paycheck Protection Program loans online, FINSYNC’s solution simplifies workflow and document management for both banks and their business clients. The simple deployment process can be accomplished in less than 24 hours.  FINSYNC’s solution includes:

FINSYNC-Powered Online PPP Application

  • Simple, secure online PPP application that’s easy to use and intuitive 
  • Helpful payroll cost calculators and other resources that help applicants complete the process correctly the first time 
  • Secure portal for uploading supporting documentation 
  • Applicants receive free tools to track and report on forgiveness eligibility

FINSYNC-Powered Lender’s Portal

  • All applications and supporting documentation are routed to the lender's own portal 
  • Notifications of new applications and status changes are delivered electronically 
  • Built-in workflow tools guide lenders from loan processing through funding and forgiveness tracking 
  • Lenders receive assistance submitting files through the SBA’s ETran system 
Deploying FINSYNC’s PPP loan application and Lender’s Portal requires no IT investment nor integration. The “plug-and-play” solution is designed to assist banks in helping their customers get funded more quickly and easily. 

Meeting Growing Demand

As of April 14, the SBA has approved 1.1 million PPP loan applications worth $263 billion in credit extended through nearly 4,700 lending organizations. Congress is currently negotiating an additional $250 billion in relief to meet demand. The average loan amount to-date has been approximately $240,000, which covers a typical small business with payroll costs of nearly $100,000 per month for around 15 employees. The average loan amount will likely trend downwards as funding continues and younger, smaller companies who are developing a new relationship with their bank or credit union apply for relief. Lenders looking to grow have a unique opportunity to leverage FINSYNC’s PPP solution to meet their clients’ pressing needs and help small businesses with timely access to capital. In addition, lenders can connect with these clients through the Lender’s Portal when they need additional capital as the economy begins to recover.   Banks and credit unions interested in leveraging FINSYNC’s custom application for the PPP loan can get started in minutes here:  https://www.finsync.com/network/banks-and-credit-unions/

About FINSYNC, Inc. 

FINSYNC is the only all-in-one payments platform that helps businesses centralize control of cash flow, automate accounting, and get in sync with the right banker and financial professional at the right time.  See FINSYNC’s Television Commercial  FINSYNC’s LinkedIn FINSYNC’s Twitter FINSYNC’s Facebook Contact info:  Karsyn Meurisse  Marketing Programs Manager  (800) 699-6484 [email protected]
The CARES Act offers small business funding and coronavirus relief that can’t come fast enough. Here’s what you need to know about the PPP, loan forgiveness and more.  By FINSYNC We don’t need to tell you about the crippling impact the coronavirus is having on small businesses across the country. Whether you’re facing a serious slowdown or you’re navigating the transition to telecommuting, small businesses are facing a challenging new reality. Fortunately, help is finally here in the form of the $2.2 trillion stimulus package that passed on March 27: the Coronavirus Aid, Relief and Economic Security Act, aka the CARES Act. For individuals, relief will come in the form of $1,200 stimulus checks for qualifying taxpayers. Along with unemployment benefits that have been extended to independent contractors. Also, the ability to use qualified retirement savings to cover your rent or mortgage without paying a 10% early withdrawal penalty. But what does the CARES Act mean for small businesses? 

PPP: Forgivable Small Business Funding

For many small business owners, the highlight of the CARES Act is the SBA’s Paycheck Protection Program (PPP), which is a forgivable loan designed to keep employees on the payroll. As long as you adhere to the guidelines, it’s essentially free money. Even better news? You don’t need an impeccable credit score, collateral, a personal guarantee, or even a well-established business history to qualify. The program will run through June 30, 2020 and initially capped at $350 million. However, due to incredibly high early demand, on April 7 Treasury Secretary Steve Mnuchin asked congress to secure an additional $250 billion for the PPP in order to meet demand. He also suggested that additional funding could be available in a matter of days.  And while banks and financial institutions are playing catch up as the applications come flooding in, small businesses are encouraged to apply as soon as possible for the best chance of getting a piece of the $350-$600 million pie. Here’s everything you need to know about the Paycheck Protection Program, and the other small business benefits provided by the CARES Act.   

Who is Eligible for the Paycheck Protection Program? 

Small businesses that employ less than 500 employees, have been in business since February 15th or earlier, and have been affected by COVID-19 are eligible for PPP. 

How Much Can My Small Business Borrow?

The amount you can borrow for the PPP is based on your payroll, which it’s designed to cover. You may borrow up to 2.5 times your business’s average monthly payroll costs for the period of Feb 15, 2019 — June 30, 2019 (not to exceed $10 million). This helpful guide can help you determine which payroll costs should be included and excluded in your calculations. 

Do I Have to Repay My PPP Loan?

Here’s the good news you’ve been waiting for. If you maintain your payroll and headcount for eight weeks from the time you receive the funds, you will not need to repay the federally guaranteed loan. The SBA will forgive the portion of the loan that you use to cover payroll and operating expenses for the first eight weeks, including:
  • Payroll
  • Rent
  • Utilities
  • Mortgage interest
In order to qualify for loan forgiveness for the above expenses, you must maintain your current payroll. Or rehire any employees that were laid off due to the pandemic by June 30. If you reduce your workforce or lower your employees’ wages more than 25%, the amount of loan forgiveness will be lowered. You must track your payroll, mortgage interest, rent and utility costs during the eight weeks in order to be forgiven for the loan. Our guide and calculator can help you easily track expenditures in order to ensure maximum forgiveness.

What Happens After Eight Weeks?

If you’re fortunate enough to have funds leftover after eight weeks (from the time you receive the funds), you have two years to pay off the unforgiven portion of the loan. All interest and principal loan payments are deferred for the first six months of the loan (not forgiven). The interest rate is 1%. 

How Can My Small Business Apply for the PPP Loan? 

The application for the Paycheck Protection Program is online and all current SBA 7(a) lenders are providing the loan. In addition, new lenders including banks and alternative lenders are quickly being authorized as lenders to meet the high demand. Which is currently overwhelming traditional lending institutions. Can’t get through to your bank? Many online lenders are offering SBA disaster loans, along with a streamlined application process. Learn more about applying for the PPP. 

CARES Act Benefits: Beyond the Paycheck Protection Program 

The PPP may be the most anticipated benefit offered by the CARES Act. However, it’s not the only coronavirus relief included in the stimulus package. Here are a few more programs that small businesses can take advantage of: 

EIDL & Emergency Economic Injury Grant

The CARES Act expands the SBA’s Economic Injury Disaster Loan (EIDL) program to include an emergency advance of up to $10,000 for small businesses and private non-profits impacted by COVID-19. To receive the grant, you must apply for an EIDL and request the advance. You’ll receive the grant within three days of approval, and the $10,000 advance does not need to be repaid. 

Small Business Debt Relief

Already have an SBA loan? Through the SBA Debt Relief Program, the SBA will automatically pay the principal, interest and fees of current 7(a), 504 and microloans for a period of six months. The same applies for new 7(a), 504 and microloans issued prior to September 27, 2020. If you have a current SBA Serviced Disaster (Home and Business) Loan that was in “regular servicing” status on March 1, 2020, the SBA is providing automatic deferments through December 31, 2020.

SBA Express Bridge Loan

The CARES Act also expands the SBA’s Express Bridge Loan program, which expedites loans of up to $25,000. To be eligible, you must have an existing relationship with an SBA Express Lender, and have been affected by COVID-19. 

Tax Breaks for Small Businesses

  • Employee Retention Credit

Your small business may be eligible for a refundable tax credit if your business has been partially or fully suspended due to a shutdown order, or your gross receipts declined by more than 50% compared to the same quarter last year. The refundable tax credit is 50% of up to $10,000 for wages paid from March 13 to December 31, 2020. Learn more about the Employee Retention Credit. 

  • Payroll Tax Deferral

If your business does not receive forgiveness on a PPP loan, you are eligible to delay payment of payroll taxes. You may postpone your 2020 payroll taxes through the end of 2022. You’ll need to pay 50% by December 31, 2021, and the remaining amount by December 31, 2022. Self-employed individuals can also delay the tax payment. 

Small Business Counseling and Training

The CARES Act is also funding expanded counseling and training for small business owners needing support and guidance to navigate this uncertain time. Counseling is available through your local Small Business Development Center (SBDC), Women’s Business Center (WBC) or SCORE mentorship chapter.   Funding will also be dedicated to hiring staff and providing programming for the Minority Business Development Agency’s Business Centers (MBDCs) which caters to minority-run businesses. Learn more about all of the small business benefits offered by the CARES Act, and access a free online loan calculator here. Whether you’re looking for a forgivable PPP loan so you can keep your employees on staff, or you could use some free counseling and guidance. The CARES Act offers a wide variety of coronavirus relief for small businesses. More funding likely coming soon.
If COVID-19 has affected your business, you have several options for accessing funds fast. Learn about your small business funding options for coronavirus relief.  By FINSYNC Many small businesses are pondering their financial future in  light of the coronavirus outbreak. And while there are many unknowns, a variety of small business loans are now available to help you keep the lights on through this uncertain time.    Some available loan programs are newly created and financed by the CARES Act, while others were put in place long ago for times like these. Coronavirus relief loans are primarily meant to help small businesses cover salaries, rent, and overhead.  There’s a lot of information out there about the various loan programs, and it can be overwhelming to sort through. To make things a little easier, we’ve put together a list of funding options for small businesses, including criteria for applying to each of them. 

Paycheck Protection Program (PPP) 

A newly created program under the Coronavirus Aid, Relief and Economic Security (CARES) Act, the Paycheck Protection Program is primarily designed to help small businesses keep employees on the payroll. The program has $349 billion in funding to provide forgivable loans and is administered by the SBA 7(a) loan program.  Existing SBA 7(a) lenders are already providing this loan, and additional lenders are quickly being approved to offer the loan. The program will be available until June 30th, 2020, and you can only take out one loan through this program.  Many of the usual SBA 7(a) loan program requirements are waived for the PPP. Here’s what you need to know about the Paycheck Protection Program: 
  • All or part of the loan can be forgiven if used to cover payroll and approved operating expenses for eight weeks from the date of receiving the loan.
  • All payments will be deferred for the first six months after the loan is paid out. The loan will accumulate interest from day one.
  • You don’t need to have any collateral.
  • There is no need to have a personal guarantee.
  • The interest rate is 1.00%, and repayment time is two years on any portion that is not forgiven.
The loan can be fully or partially forgiven if used for payroll, interest on existing loans, rent, and utilities. To qualify for loan forgiveness, you need to refrain from:
  • Decreasing your full-time employee headcount.
  • Reducing wages by more than 25% of annual salary for employees who made under $100,000 in 2019.
  • Using more than 25% of the loan on other expenses.
You are allowed to reduce both headcount and wages as long as it’s done before April 26, 2020. On that condition, you have until June 30, 2020, to reverse the changes to still be eligible for the full loan forgiveness. Learn more about the Paycheck Protection Program, and apply for this small business coronavirus relief program here.

Economic Injury Disaster Loans (EIDL) 

The SBA Disaster Assistance Loan program has existed for a long time and is intended to help small businesses recover from physical and economic damage due to a disaster.  What you need to know about this program:
  • You can apply for the loan regardless of your location, as all U.S. states are now declared disaster areas.
  • You can receive up to $2 million.
  • The interest rate is 3.75%.
  • You can use the loan to pay for any expenses.
  • The repayment period is up to 30 years.
  • The loan has an automatic, one-year deferment period.
Much like the requirement for the PPP, the requirements for the EDIL reduced significantly. For example, when applying, there is no requirement to provide documents. Such as, tax returns or financial statements.  You can apply for a COVID-19 disaster loan here. 

Online Lenders 

If these two programs are not an option for you, consider alternative lenders.  Like the loan options mentioned above, you can apply for loans through alternative lenders by completing FINSYNC’s electronic loan application. Online lenders provide everything from SBA loans and term loans to lines of credit and equipment loans. Online lenders tend to offer a faster and more convenient application process and have more flexible lending requirements. In the current landscape, alternative lenders may also be more accessible than traditional lenders, many of which are currently being overwhelmed with applications for coronavirus relief. New lenders are being approved to offer coronavirus relief loans daily, including online lenders.

Main Street Business Loan Program 

If your business has over 500 employees, you won’t qualify for small business lending. However, the Federal Reserve is working on a program intended to help small to midsize businesses get through the COVID-19 crisis. The Main Street Business Loan Program was announced on March 23, but the details are still being determined.

How Fast Can You Get Funding and Loan Forgiveness for Your Small Business?

How fast your business will have access to the funds will depend on the program you apply to, and the lender you choose. Lenders that participate in the PPP and the EIDL may have their own requirements; for example, they may require an online application, or only consider applications from existing customers with an existing loan. If your primary bank relationship cannot help you with financing, please apply for the SBA programs through FINSYNC to reach other lenders. Either way, you can prepare for the application process by preparing your 2019 and 2020 payroll expenses.  When it comes to loan forgiveness with the PPP program, you can apply eight weeks after the loan is made. During those eight weeks, you will need to track your payroll, mortgage interest, rent, and utility costs. This can also be done in FINSYNC for easy reporting to your lender, who has 60 days to make a decision.
With a huge percentage of the 30,000,000 US-based small businesses expected to apply for the PPP, execution is critical. It happened. A new, particularly strong virus quickly bloomed into a global pandemic. While the Federal Government's response was timely and well-funded, a lot of loose ends were left with regards to execution, specifically regarding the technology needed to execute. Businesses were encouraged to apply for the SBA Payroll Protection Program (PPP) starting last week. More importantly, they were encouraged to apply for the loan through their existing banking relationship.

Unprecedented Demand

A loan that becomes a grant and allows a business to cover payroll while shut down? Who wouldn't apply? The SBA estimates there are roughly 30,000,000 small businesses in the United States. According to the Independent Community Bankers of America's President & CEO, Rebecca Romero Rainey, "Community banks make 60 percent of small business loans." While estimates of the SBA's total loan volume processed annually prior to the crisis rest around $20 billion annually, the PPP program authorizes $349 billion, and that money is to be deployed immediately.

Inadequate Tools

While no one doubts the program is well-intended, community bankers are in an awkward position. They have been positioned by government and the press as the saviors of small business (through their access to these funds). However, their ability to help is severely hampered using their current tools. Romero continues: "Community bankers have always been there to meet their customers' needs, and to be faced with a situation like they experienced today--in which they were unable to access the SBA programs promised to America's small businesses due to failed technology links and portals--has been beyond stressful and disappointing." While a new portal has been promised, it has not been delivered. Banks with access to E-Tran have reported "significant challenges with user access and latency in application processing."

A Looming Threat

While community bankers continue to pressure their contacts at the SBA and Department of Treasury for solutions, rumors are swirling that two of the stronger Fintechs, PayPal and Square, may be granted special privileges to provide electronic loan applications for the PPP. With significant user bases on both the consumer and business sides of the market, Square and PayPal both stand to become even more disruptive to community banks.

A Generational Opportunity

While there are certainly problems to solve, there is also an enormous opportunity to provide assistance to small businesses in their darkest hour. Not only will community banks that successfully deliver PPP funds to their clients attain hero-status indefinitely, they also stand to make significant gains for their shareholders as $349 billion in loans are rapidly deployed to the market. Banks that want to address this crisis head-on should look to Fintech as well, but choose a partner that works collaboratively with financial institutions, always looking to provide additional capabilities while keeping the bank at the center of the business client relationship. FINSYNC is that partner. FINSYNC's electronic loan application is plug and play. Additionally, the application feeds into the bank's connected Lender's Portal, a cloud tool for processing and underwriting loan applications. The best part...a bank can deploy FINSYNC's solution in 24 hours, with no IT integration required. Is your bank ready to start helping businesses in need? Join the FINSYNC Network today.
The Covid-19 crisis has created unprecedented opportunity to launch a virtual accounting practice. With the pandemic of Covid-19 and the Federal Government's response to an economic downturn expected to dwarf the sub-prime crisis of 2008, there has never been a better time for accounting professionals with the right skills to help get the nation back on its feet.

Tidal Wave of Applications for the SBA Paycheck Protection Program (PPP) Expected

Ask any small business owner what's on their mind in the midst of shelter-at-home, and their responses will be similar. The health of their family followed very closely by the health of their business. With shelter-at-home keeping consumers from purchasing goods and services across so many industries, unemployment rates have already skyrocketed. The CARES Act, and specifically the PPP, could not come sooner. However, not unlike the HealthCare.gov fiasco, there is already confusion about how to apply to secure the financing. With PPP, a business can secure financing that becomes a grant. As long as the business continues to pay employees in accordance with the program's requirements, the government will forgive the loan. Free money. What business owner wouldn't apply? The opportunity is fantastic, but the application process leaves a lot to be desired. The forms and documentation are so complex that a small business owner without a strong financial education has little chance of completing them correctly without assistance. An incorrect application could lead to delays in receiving the loan deposit of several weeks. Businesses who complete the form correctly the first time can have funding in as few as 2 days. A very high percentage of 30,000,000 small businesses will apply for this program in the coming weeks. That's where you come in.

The Crisis is Unprecedented, the Method of Work is Not

How do you serve small businesses in this time of need? Virtually. The market for professional services has been trending towards virtual services for some time. Business owners have used virtual services in marketing technology through publicly traded companies such as Upwork and Fiverr for quite a while. Businesses use Uber to navigate business trips. FINSYNC has developed its Services Network specifically to solve the need for professional, vetted financial assistance for US-based companies. Businesses simply request services through the app, and, based on their needs, get matched to the professional best suited to their requirements. That professional could be you.

The Tools Are Readily Available

While taking first steps into the virtual, gig-economy may seem frightening at first, it's a lot more personal than you might think. Google, Zoom and others provide free tools for video conferencing. FINSYNC service providers have access to its business software that includes Payments, Accounting, Payroll, Projects, and, most importantly in the current economic climate, Cash Flow Management. FINSYNC also makes its services portal available so that you and your new business customer can communicate virtually, with activity tracking, commenting and document management all simplified and at your fingertips.

Get Started in VIRTUAL ACCOUNTing

To get your virtual accounting career started, simply complete your 10 minute application.  There's no cost to apply or become a FINSYNC Specialist. You'll be paid via direct deposit for your work helping businesses navigate the SBA application process. You'll also have the opportunity to earn future work when normalcy returns to the economy and businesses need all your other amazing skills!
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Payments
Bill Pay
Invoicing
Accounting
Payroll
Expense Reimbursement
Time Clock
Time Sheets
Projects
Cash Flow Management