Loans & Funding Programs For Small Business Owners
Traditional Term Loans
One of the best options for small business owners in need of funding is the Traditional Term Loan.
Term Loans are a set amount of money, to be paid over a specific time period in set installments. The main advantage to the Traditional Term Loan is its consistency. For those businesses looking to borrow a large sum of money, and rather quickly, will find the Traditional Term Loan to be the best option for their business.
Small Business Credit Cards
Most consumers will be familiar with the inner workings of a credit card. When used responsibly, small business credit cards can give owners cash on an as needed basis, while allowing them to pay off the debt in monthly payments. The advantage of a credit card is that there is a constant revolving line of credit that can be utilized by the business whenever necessary. As long as the minimum monthly payments are made, no penalties or fees will accrue on this card.
Merchant Cash Advance (MCA)
Unlike the Small Business Credit Card, Merchant Cash Advances are a less well-known option for business owners. Merchant Cash Advances, or MCAs, are large sums of capital advanced to borrowers from lenders. This option is one of the best for borrowers with average to below-average credit, as credit score plays a very little part in the application process. In return for the loan, the lender will receive a percentage of all credit card sales through the borrower’s business. MCAs are delivered to borrowers fast, and should be paid back to the lender as quickly as possible. All in all, they are a great option for businesses looking for a lump sum of money that can be paid just as quickly as it is borrowed.
Business Lines Of Credit
Business Lines of Credit are another very popular way to gain funding for a small business. Although similar to Small Business Credit Cards, Business Lines of Credit can be taken out for large sums of money and are paid out in monthly installments similar to a Traditional Term Loan. The disadvantage here is that there is no set percentage of interest for Business Lines of Credit. Depending on your credit score health, these rates can fluctuate at an alarming rate. For larger amount of money borrowed, this can be a big problem for borrowers. However, if the borrower has a relatively good credit standing and able to make consistent payments on the line of credit, this can be a very beneficial option to business owners.
Small Business Administration Loans (SBAs)
Small Business Administration Loans, or SBAs, are funds made available to businesses through participating lenders. Typically sourced through banks, these loans have some of the lowest interest rates and most flexible repayment terms. SBAs can have some major drawbacks.
In most cases, it can take months for a Small Business Administration Loan to go through, if at all. Credit history, both for the business and personally, plays a major role in the application process. Those with less than ideal standings will likely not be eligible for Small Business Administration Loans.
Small Business Grants
Small Business Grants are some of the most highly sought out and competitive forms of small business funding. Essentially this option is free money, so competition is extreme. Many times federal, local, or non-profit agencies will offer funding to small businesses that fit certain criteria or follow specific guidelines. These businesses are eligible to qualify for funding at no cost to the business owner. The drawback here is that these grants are few and far between. They also often have very specific terms to the grant, and are only awarded to businesses benefitting specific groups of people or movements. However, this is still a viable option for many small business owners if the criteria are met.
Venture Capital is an extremely popular form of funding for small business owners. When a company offers a percentage of ownership or share of a company, in exchange for funding, this is considered Venture Capital. Although a great option for thriving business owners, it can be difficult to find investors if your business is small or indistinct.
Angel Investments are similar to Venture Capital, in that investors seeking out promising new or small businesses will offer a large sum of money, or “seed money”, to help the business take off. Although this may seem like the most ideal option for business owners, Angle Investors typically seek out businesses that can potentially offer returns on their investment, once the business is successful.
Banks across the country are taking steps to help consumers impacted by the deadly coronavirus.
As retailers temporarily close up shop and employers cut back on hours, consumers should find out whether their banks are included on the list of those making policy adjustments.
Here’s a running list of decisions some banks have made to support customers with CDs, checking accounts and other types of savings products who are struggling to make ends meet.
In an email sent March 18, the online-only bank reminded customers with deposit accounts that they have no minimum balance requirements or monthly service fees to worry about. Ally Bank also said that for the next 120 days, it will not charge savings and money market account holders excessive transaction fees or charge customers for overdrafts. Furthermore, there will be no fees for expedited shipping of checks or debit cards.
Retail banking customers with questions can call Ally Bank customer care 24/7 (1-877-247-2559). On its hub page with information about the coronavirus, Ally Bank encourages customers to download the bank’s mobile app and enroll in online services. There’s also relief for Ally’s auto loan and home loan customers in the form of payment deferrals for up to 120 days, without late fees.
Bank of America
The bank noted that employees are trained to help decide what the right support for an individual customer looks like. A spokesperson for the bank also notes that, “As part of our regular practice, we offer assistance to qualifying consumer and small business clients facing hardships, including forbearance with certain fees.” Bank of America’s CEO has agreed to donate $100 million to support communities impacted by the outbreak.
Account holders are welcome to contact the bank if they need financial assistance. Through the bank’s Financial Center and ATM locator, you can find out whether the nearest Bank of America facility is open. The bank is also adjusting the hours at financial centers. All financial centers will be open at set times during the week and during normal hours on Saturdays. Its page noting the steps they’re taking in light of the spread of the virus also reminds customers that online banking and the Bank of America mobile app are also options.
Customers of the regional bank based in Birmingham, Alabama should contact a representative to find out whether they qualify for any assistance the bank is providing.
CDs opened before March 1 can be withdrawn without penalty upon request. A number is listed (1-844-222-3862) for customers who might benefit from a line of credit, credit card or loan payment extension or deferral. Upon request, BBVA is also waiving and refunding ATM fees charged by out-of-network banks and ATMs. The existing offers only apply through April 17, but this end date may be extended if needed.
BBVA advises that customers use this tool to check the status of their local branch or ATM. Branches are being kept clean and supplied with latex gloves for the banking staff and hand sanitizing stations for customers.
The McLean, Virginia-based bank has a page that’s dedicated to addressing questions and concerns related to the coronavirus. It’s asking customers to reach out if they’re going through a difficult financial situation. The customer support section of their website lists various phone numbers account holders can use depending on the product or account they have.
Effective Monday, March 16, Capital One Cafes nationwide are temporarily closing, the bank’s website says, “due to growing public health concern and in an effort to be proactive.” Branches in certain areas are also temporarily closing.
If you need to access a branch, check online first using the Locations Finder tool to find out if there’s one open near you. In the meantime, the bank recommends using its mobile app and other digital tools. Capital One ATMs, including most of the machines in the cafes and branches that are momentarily unavailable, are still accessible 24/7.
The CEO of Chase consumer banking has a message for customers listed on the bank’s website, noting that it’s donating $50 million to nonprofits to “help address immediate public health needs as well as long-term economic challenges.” The message also recommends that customers reach out to the bank if they need assistance as a result of the coronavirus outbreak.
Effective March 19, Chase is temporarily closing 20 percent of its locations (1,000 branches). The remaining branches will continue to operate, but will close early. Customers who need branch access should visit the Chase website to find the nearest open location. Otherwise, customers should use the Chase mobile app and its other digital features.
On March 9, Citi agreed for at least 30 days to waive monthly service fees for retail banking customers and waive penalties for early CD withdrawals. These fee waivers and an additional one for remote deposit capture fees are also waived for retail bank small business customers.
Mortgage customers may be eligible for a hardship program and Citi credit card holders may be able to increase their credit lines and benefit from collection forbearance programs. Customers should reach out to the bank to find out if they qualify for assistance.
In its branches, Citi is providing plenty of hand sanitizer and ensuring that workers are aware of health and safety guidelines released by the Centers for Disease Control and Prevention (CDC). Customers should use the ATM and branch locator to find out which branches have temporarily closed, and which ones have adjusted their hours.
Citizens Bank announced March 23 that it’s dedicating $5 million to aid small businesses and communities affected by the coronavirus outbreak. Support will be provided through relief programs. Customers with cash back credit cards from the bank have the option of having all or a portion of their rewards used to help others in need.
The bank’s resource hub with information about the coronavirus outbreak mentions changes at branches, including temporary changes in hours (Monday – Friday from 10 a.m. to 3 p.m. and Saturdays from 9 a.m. to 12 p.m. at locations normally open on weekends) and the installation of plexiglass windows to separate tellers from customers. Drive-up windows are still available, but branch visits must be scheduled as appointments in advance. Only two customers can be present in the branch lobbies at all times and employees are helping customers at teller windows one at a time.
Customers are encouraged to use ATMs and the bank’s digital banking services. Those struggling financially can call the bank’s contact center (800-922-9999) to discuss fees and options such as no-penalty access to CDs. Under the bank’s set of frequently asked questions, other phone numbers are listed for specific products and the bank notes that it is temporarily automatically increasing mobile deposit limits.
Discover has a page with frequently asked questions and phone numbers for customers with Discover loans and credit cards who have been impacted by the coronavirus.
Online banking customers who need assistance can call the number provided (1-800-347-7000). A spokesperson for the bank says customers may receive assistance related to payments, fees and interest.
Fifth Third Bank
Consumers experiencing financial difficulties as a result of the coronavirus should contact Fifth Third to find out whether they qualify for any of the hardship and payment loan assistance listed on the bank’s website , such as the vehicle and credit card payment deferral programs. Payment forbearance is available for Fifth Third mortgage and home equity loan customers. There are phone numbers listed on the website to get in touch with representatives (800-972-3030) and a dedicated hardship assistance line (866-601-6391).
There’s a fee waiver program, too, that will ensure that Fifth Third consumers and small business owners with deposit accounts won’t be charged any fees for up to 90 days. Foreclosure actions on residential properties and repossessions of vehicles will also cease for the next 60 days.
Customers can check the branch and ATM locator to get the status of their nearest Fifth Third facility. Within the branches, staff are using cleaning procedures recommended by the CDC. Beginning March 21, branches are only available for access by appointment only. Appointments can be made by calling your local branch.
The company announced via email that customers using the online banking platform and lender, known as Marcus, would be allowed to delay making payments for a month. No interest will be charged and your loan term will be extended by one month. And users with an Apple Credit Card — which is issued by Goldman Sachs — will be able to avoid making payments for the month of March entirely without worrying about accruing any interest.
In addition to offering personal loans, Marcus by Goldman Sachs is an online bank that provides access to high-yield CDs and savings accounts and no-penalty CDs that don’t charge customers for withdrawals beginning seven days after opening an account. CD holders who need extra funds can request an early fee-free withdrawal by calling a number listed on the website (1-855-730-7283).
Key Bank, a regional bank based in Cleveland, announced March 25 that it’s offering borrowers who are struggling financially the chance to defer payments for up to 90 days. Customers who qualify can avoid making interest and principal payments (though interest would still accrue) and the bank would not report anything negative to the credit reporting agencies. To find out more, you can call the number listed on the bank’s website (1-800-539-2968).
Relief is available for small business owners, too. Customers who need to have fees or early CD withdrawal penalties waived or loans extended should also contact the bank.
Branch services are mainly accessible through the drive-thru option, although appointments can be made online to visit in-person, if needed. All branch lobbies are closed for now and beginning on March 30, certain branches will close temporarily. Digital banking options and ATMs will continue to be available.
The bank, which is headquartered in Pittsburgh, also has a page dedicated to answering questions customers may have related to the coronavirus. Effective March 20, the bank will close one-quarter of its branches until further notice and leave the rest open, operating mainly in a “drive-up only mode.” Hours for the remaining locations will be reduced and will be open during the week from 10 a.m. to 5 p.m. and from 9 a.m. to 1 p.m. on Saturdays.
Customers who need to visit a branch to access safe deposit boxes or other services not accessible via an ATM, a drive-up window or through the bank’s digital channels can make appointments. A PNC branch locator is available to see which branches remain open.
The bank also says it’s willing to assist account holders experiencing a financial hardship and has a customer service phone number listed (1-888-762-2265).
The Cherry Hill, New Jersey-based bank has a list of bank stores on its website that are temporarily closed. It also says that it is reducing hours at some locations and sending hand sanitizing kits as needed.
Account holders facing a financial hardship due to the coronavirus should call customer service (1-888-751-9000), which is available 24/7. Customers who cannot visit a physical location are being directed to TD Bank’s online and mobile banking platforms. They can also stop by ATMs to make withdrawals and deposits.
The bank, which formed out of a recent merger between SunTrust and BB&T banks, says on its website that it’s taking extra precautions to ensure the safety of its customers. Anyone who needs in-person branch access should go online to book an appointment. Some branches are closed and others are mainly operating through drive-thru lanes. Information about branch hours at BB&T and SunTrust branches is also online.
Other steps taken by the bank include waiving ATM surcharge fees temporarily for consumers and business owners and offering payment relief assistance for customers with credit cards, business loans and consumer loans. In addition, SunTrust and BB&T consumer credit card holders can get 5 percent cash back through Apr. 15 when they purchase certain items at pharmacies and grocery stores. There are also phone numbers listed on the Truist website that retail and business clients can call.
On Mar. 17, the Truist Financial Corp. pledged that it intends to donate $25 million through its Truist Cares initiative to provide aid and supplies to clients, employees and communities across the U.S. impacted by the coronavirus. Through the Truist Charitable Fund, a $1 million donation is immediately going to the CDC Foundation and Johns Hopkins Medicine. Through the Truist Foundation, a $3 million donation will be given to United Way organizations that support local communities.
Customers of U.S. Bank will also find a message from the CEO on the bank’s website. It outlines what the bank has done to protect its clients and retail bank customers, like providing extra hand sanitizer, wipes and spray in branches.
On March 13, U.S. Bank temporarily lowered costs for borrowers interested in personal loans and the bank’s Simple Loan product, which has been touted as a payday loan alternative for low-income Americans who need access to small-dollar credit options.
As of March 19, customers are being asked to use the bank’s drive-up windows as activity inside many branches has been reduced. Hours at all branches have also been reduced. Customers are reminded that they can check the availability of local branches and use the bank’s digital capabilities to bank at home.
Customers of Wells Fargo also have a hub page to access for all updates regarding the coronavirus. Wells Fargo lists a phone number (1-800-869-3557) account holders can call if they need financial assistance and want to discuss their options.
The bank is encouraging account holders to use Wells Fargo’s digital tools. Call centers are still open, but some branches have temporarily closed, and some hours have changed at certain locations. To find out more, there is a branch and ATM locator. In some branches, you’ll need to go online and make an appointment for activities that can only be done in person.
The Wells Fargo Foundation has agreed to donate up to $6.25 million to public health aid efforts being made abroad and here in the U.S. It will also soon donate up to $5 million to support local communities.