Simplifying Applications for Covid-aid Loans Draws More Businesses

"The Central Arkansas Planning and Development District in Lonoke learned to simplify the application process to attract small businesses that could use the organization's revolving loan fund.

"We're finally getting some traction in the past week or so of working with many organizations and leaders to get the word out," said Trevor Villines, regional economic disaster economic recovery coordinator for the organization, which serves Pulaski, Saline, Faulkner, Lonoke, Monroe and Prairie counties.

That wasn't the case just a week or so ago as the district struggled to bring in applicants for the $910,000 available through federal coronavirus relief. The revolving loan fund is supplied by the U.S. Economic Development Administration, which is part of the Commerce Department, to bolster small businesses that have lost profits or suffered economic harm because of the pandemic.

"Money is available for any business that is finding it hard to make it through covid," Villines said.

The district found that simplifying the entry process was key to boosting interest. Rather than introducing potential borrowers to a 30-page application, the district offered a simpler, self-check eligibility list that allowed those interested in a loan to determine if they were even eligible. The form can be downloaded from the district's website and completed in a manner of minutes.

"That simplification really turned everything around," Villines said. "It just made the eligibility and the application process so much easier. People were just overwhelmed with a 30-page application and they just didn't know where to start."

Loans are similar to the more notable, and popular, Paycheck Protection Program though there are major differences -- the biggest being that payments are not forgiven. Borrowers under the revolving loan fund are obligated to repay the proceeds.

Businesses with up to 300 employees can borrow a maximum of $100,000, with an interest rate of 3%, and have up to five years to repay the loan.

Financial assistance can cover a variety of expenses, including working capital, lease payments, payroll shortage, existing real estate, equipment, building renovations and technology upgrades.

Any profitable small business in any economic sector that has been in operation for two years can apply for funding.

There's plenty of money and time to apply -- funding is available until August 2022 unless it runs out first. The district still has more than $700,000 available.

Go to www.capdd.org/cares-act-rlf for more information."


Source: https://www.arkansasonline.com/news/2021/feb/07/simplifying-applications-for-covid-aid-loans/

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