The U.S. Small Business Administration announced Thursday that it is offering low-interest federal disaster loans for working capital to Illinois small businesses suffering losses as a result of the coronavirus pandemic.
The SBA acted under provisions of the Coronavirus Preparedness and Response Act signed by President Donald Trump following a request from Governor J.B. Pritzker last week.
The program offers up to $2 million for businesses with fewer than 500 employees, offering interest rates of 3.75 percent for for-profit businesses and 2.75 percent for some nonprofits.
The Illinois disaster proclamation makes the assistance available throughout the state and several counties in Iowa, Kentucky, Missouri and Wisconsin.
"SBA is strongly committed to providing the most effective and customer-focused response possible to assist Illinois small businesses with federal disaster loans," SBA Administrator Jovita Carranza said. "We will be swift in our efforts to help these small businesses recover from the financial impacts of the coronavirus."
Applicants can apply online, receive additional disaster assistance information and download applications at https://disasterloan.sba.gov/ela. They can also call customer service at 800-659-2955 or email firstname.lastname@example.org.
The deadline to apply for a loan is Dec. 21.
Also, Illinois State Treasurer Michael Frerich said Friday his office would make $250 million in low-interest bridge loans available to small businesses through banks and credit unions as soon as this week.
"We can move faster than the federal government and its partners because we are not slowed by the partisanship that overshadows such efforts," Frerich said. "Part of ensuring the health and well-being of our residents includes making sure small-business owners stay solvent so their workers can be paid."
Kraig Lounsberry, president of the Community Bankers Association, encourages its members to participate in this loan program. "Partnering with the state treasurer's office will give community banks a powerful new tool to quickly protect small businesses suffering during this crisis," Lounsberry said.
The Illinois State Treasurer's Office can move faster than others because facilitating low-interest loans is one of its core functions. These linked-deposit loans have been a staple for decades. The most widely known linked deposit is Ag Invest, which helps farmers with annual and long‑term loans to be used for operating costs, equipment purchases, livestock purchases, and construction-related expenses. Established in 1983, Ag Invest has provided more than $4 billion in loans.
Other linked-deposit models include efforts to assist workers impacted by a government shutdown; faith‑based organizations seeking facility improvements; and the legal cannabis industry.
For more about the Illinois Small Business COVID-19 Relief Program, visit bit.ly/SmallBizRelief.