Local business has problems applying for loans, SBA says it’s making improvements

Capitol Connection

RICHMOND, Va. (WRIC) — Loans are a lifeline for stores forced to close their doors due to the coronavirus but one local business says they had problems with various applications.

Chris Smith said COVID-19 restrictions have already caused about a quarter of RBI Services clients to temporarily close or cut back hours.

“It’s going to get tougher for people to pay their bills and when they can’t pay their bills services like accounting and insurance go by the wayside,” Smith said.

Smith said he’s been looking for loans to keep his business above water. He said after completing nearly all the requirements for a microloan recommended by the Virginia Small Business Financing Authority, he was told the counseling services he needed weren’t available in the area.

“Only two areas of the state would be eligible and metro-Richmond is not on that list,” Smith said.

Smith says he also hit a snag when applying for a disaster loan through the Small Business Administration. He said the website crashed multiple times.

The SBA didn’t provide specifics on how many applications they’ve received in the last two weeks but Martin Short, the organization’s lead economic development specialist, said in an email that the volume is unprecedented. Short said that’s caused some users to see error messages.

Barry N. Moore, President and CEO of the Better Business Bureau serving Central Virginia, said they’ve been in touch with the SBA about website issues.

“The SBA is getting millions of requests. They’re not made to handle that much at once,” Moore said. “The problem is its taxpayer money and there has to be a process.”

Short said the SBA has made improvements to the website in the last couple of days. “We continue to work with our federal and private sector partners to improve capacity and we appreciate the patience of our small business community as we move forward,” he said.

Short adds that small businesses and non-profits can now scan and upload PDFs to the SBA’s website or send them by mail to the Fort Worth, Texas address found on the application.

When asked via email if the SBA has enough staff to process the influx of applications, Short didn’t answer directly. He said all SBA staff are focused on helping small businesses endure difficult times by providing one-on-one assistance and webinar training to explain the process.

The U.S. House of Representatives is expected to vote on a federal stimulus package on Friday that includes roughly $350 billion for small business loans and grants. Sen. Tim Kaine (D-VA) says many of the loans are forgivable.

Smith said he’s encouraged by this progress but the wait isn’t without worry.

“My fear is that some of these businesses are going to shut down and may not come back,” Smith said.

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