Over the past two weeks, I’ve been trying to help friends and family members explore a long list of acronyms: SBA, EIDL, PPP, and PUA. While the 24-hour news cycle has been quick to report on PPP, it’s mostly ignored. Programs that truly aim to help small business owners: Economic Disaster Loan (EIDL) and Pandemic Unemployment Assistance (PUA).
government not only but only shortage But misinformation about available relief is causing more economic damage than it promises. As an independent contractor and a brick-and-mortar small business owner, I’ve come to realize the issue is at both ends of the crisis.
Condition of Gig Worker
There are 10 to 15 million independent contractors in the United States, many of whom have been misclassified by their employers as SBA 7A Loan Disadvantages. Gig’s work has flourished, and now Instacart, Shipt, and DoorDash employees are at the forefront of our efforts. Independent contractors have the undeniable mission of being “his own business” which consists of operating expenses, employment taxes, and administrative expenses.
Unfortunately, they are left out when it comes to government stimulus measures. Theoretically, gig workers should be able to apply for EIDL, PUA or PPP, but the reality is very different. Due to these program requirements and their flawed implementation, most independent contractors do not receive any relief at all.
At the same time, small business owners are left in a cluttered area. Small business owners have been told they can get a $10,000 grant in 3 days and rely on this – but no giveaway. They say they can get PPP or EIDL loans for rent and paychecks, so they avoid laying off employees and then they get rejected for these loans.
Small business owners have been told multiple times that funds are available. But because they had no access to those funds, they began to shut down and go out of business. Some of these issues are directly related to the SBA, but the confusion the SBA has sowed has made the situation worse.
From the EIDL SBA to the agile EIDL: a communication crisis
Let’s get it from above. The SBA offers economic injury 7A Loans for businesses in disaster-affected areas. Traditionally, those disasters were earthquakes or tornadoes. Initially, small businesses are encouraged to apply for EIDL if they are affected by COVID, but when they can file depends greatly on their status. Their states must first declare a statewide COVID-related disaster, and then ask the SBA to include it.
So not every business owner can put an EIDL application at the same time. Here’s the problem: Funds now seem to come first.
Over the last weekend of March, the SBA quietly released a robust EIDL form. This streamlined EIDL form is connected to the contract of $10,000 granting any qualifying business. This grant is an upfront payment and does not involve loan approval. Business owners flock to register because the CARES bill states that these $10,000 grants will be received within three business days.
But no one received those funds.
On April 6, the SBA announced that those who have previously entered a long application will also be required to enter a streamlined application. They increased the processing time to a week. I personally submitted my EIDL loan application on March 22nd and haven’t heard anything since. I submitted a streamlined EIDL Loan Application on April 2nd – Cricket.
Rumor has it that the SBA lost all materials from March 15th to March 31st, these were unconditional. However, it must be borne in mind that the status of the loan requested during that period cannot be checked. Unfortunately, the lack of information that truly comes from the SBA makes it impossible to verify almost everything.
SBA Begins Making Changes to the EIDL Grant
On April 6th, there were two major changes to the EIDL grant. First, there was a change from “within three days” to “three days after the accepted application.” Second, there was a change to up to $10,000 in funding. $1,000 rate per employee Stores with three employees will receive $3,000, stores with 16 employees will receive the full $10,000.
This is a drastic change for a very important reason. EIDL grants are intended to assist independent contractors and sole proprietors as well as general small business owners. Independent contractors and sole proprietors do not count as their own employees and therefore will receive nothing but the promised $10,000. which will no longer be included in this grant. They receive $0.
(It’s impossible to confirm this with the SBA because they don’t know.)
This is not a necessary bill, which calls for a $10,000 ban, but while some call this a quick “illegal” change, it may not be – the SBA has some control over how it proceeds. to program, these Are this drastic change a gray area?
Unfortunately, the lack of real communication from the SBA is exacerbating the situation for small business owners and independent contractors, who now have no way of planning for an increasingly uncertain future, the SBA stated will continue to issue money. A certain amount for the week of April 6 and there is no way to tell how many will be received until received.
