Small businesses that have suffered economic losses while the owner or a key employee was called up to active duty are eligible to apply for a low-interest loan of up to $2 million from the U.S. Small Business Administration (SBA).
The agency made the announcement in a news release distributed today.
Affected small businesses can apply for an MREIDL, which is short for military reservist economic injury disaster loan, the SBA said in the release.
They can apply any time between the date that the impacted employee receives notice of expected call-up through a time period extending one year after the date of discharge or release, the agency added.
The SBA said it created the program to allow eligible small businesses to pay for operating expenses it would have covered if the owner or key employee hadn’t been called up to active duty.
The MREIDL is a direct working-capital loan, which the SBA’s Office of Disaster Assistance manages. The interest rate on these working-capital loans is 4 percent, with terms up to a maximum of 30 years.
In general, the SBA doesn’t require collateral to secure an MREIDL of $50,000 or less. A small business is prohibited from using the loan to replace lost income or profits, refinance long-term debt, or to expand the business, the SBA said.
Businesses can apply online at http://go.usa.gov/BcuA.
To receive an application by mail, or for other questions about the loan program, contact SBA’s disaster assistance customer-service center at (800) 659-2955, the agency said.