Cash-strapped small businesses were just handed another source of capital from the federal government.
The Small Business Administration just expanded its 7(a) loan program.
The temporary alternate size (good until September 2010) should make an additional 70,000 businesses eligible to apply for financing.
Here’s how to make it work for you, no matter what your size.
To find out whether your company is eligible, here are the requirements you’ll have to meet:
- Your company’s net worth can’t be more than $8.5 million and
- Your average net income after federal income taxes (excluding any carry-over losses) for the preceding two completed fiscal years can’t exceed $3 million.
Even if your company doesn’t fit the bill, you may still be able to secure a cash flow boost from this new SBA initiative.
Talk with your CFO and Accounts Receivable Manager. You probably have some customers do that meet these requirements.
Tipping them off to the new loans may just give them more cash to pay your bills (with a paying preference to the firm that tipped them off to it).