Starting on June 15, printing companies and other small businesses in tough financial straits may be able to get some of the emergency cash they need through a lending program operated by the U.S. Small Business Administration (SBA). It’s called America’s Recovery Capital Loan Program (ARC), and it’s designed to provide up to $35,000 in short-term relief for qualified applicants. The loans, made by participating banks and other commercial sources of capital, are interest-free to borrowers, guaranteed by SBA to the lenders, and repayable over periods up to five years. The idea behind the program is to take financial pressure off struggling but basically sound small firms by enabling them to redirect cash flow to business expansion and job retention. This could be accomplished by making payments on existing loans with the proceeds from an ARC loan, which are provided to borrowers over a six-month period. Repayment is deferred for 12 months after the last disbursement is made. All expense-stressed small businesses can apply, but the eligibility requirements are specific. For one thing, applicants can’t be start-ups. The company must provide financial statements demonstrating it was profitable in one of the past three years. It also must be able to project enough cash flow to meet current and future loan payments over a two-year period from loan approval. Each applicant is limited to one ARC loan. Under the program—part of the $787 billion federal economic stimulus bill passed in February—SBA will pay participating lenders a monthly interest rate throughout the terms of the loans. The agency says that ARC loans will be offered by some of its lenders for as long as funding is available or until September 30, 2010, whichever comes first. Complete information is available at the ARC Loan Program web site. To speak with an SBA customer service representative, call 866-947-8081 Monday through Friday from 8 a.m. to 9 p.m. (Eastern).
Discussion
By E. Schwartz on May 27, 2009
Many years ago, when I had just started my printing company I had a applied for a very small SBA loan (about $25,000) as one the requirements was to obtain flood insurance, this was perplexing in light of the fact that I was located on the 12th floor of a building in nyc and there was so much paper work that I spent hours compiling everything is it still like that with them or is it streamlined
By RedHatRob on May 27, 2009
how ironic that neither GM nor Chrysler would qualify under the published rules.
By R. Evans on May 28, 2009
What about a restaurant that's only been open a year? They say the first 2 years are not profitable. My first year was a loss, but now the restaurant is starting to become known in the surrounding areas. If one of the requirements is showing a profit, are those of us in my situation supposed to close? That would mean more people out of work and one more person claiming bankruptcy!!!!!
By Albert England on May 28, 2009
Jumping through hoops for $35,000 hardly seems worthwhile given the price of capital equipment in the printing industry.
Discussion
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