More NY businesses can now get NYFLF loans
Applications are now open to smaller recipients of the Paycheck Protection Program.
Initially, the New York Forward Loan Fund (NYFLF) was intended for businesses that did not receive funding through the Paycheck Protection Program (PPP). But with PPP applications now closed, Empire State Development has opened funding to businesses that received small loans through the PPP.
What businesses qualify?
Empire State Development has begun accepting NYFLF applications from businesses and nonprofits that received less than $50,000 in PPP funds. Businesses that received an Economic Injury Disaster Loan (EIDL) still do not qualify.
Both businesses and nonprofits must have no more than 20 full-time employees and make less than $3 million per year in gross revenue or have a gross operating budget of $3 million per year, respectively. You will need to demonstrate economic hardship from COVID-19 and be located in New York.
Landlords must own residential buildings that serve low- or middle-income tenants and have less than 50 units.
How it works
NYFLF is designed to help nonessential businesses get low-cost funding to reopen. Businesses are eligible to borrow an average of three months of revenue from 2019 or the first quarter of 2020 — or $100,000, whichever is less. Interest rates are set at a low 3% for businesses and 2% for nonprofits. The loan term lasts five years, but businesses are only required to make interest-only payments for the first 12 months.
Applications should be submitted directly to Empire State Development but are processed by five Community Development Financial Institutions (CDFI):
- Accion East
- Community Preservation Corporation
- National Development Council
- Pursuit
- TruFund Financial Services
And unlike PPP loans, funds from NYFLF can be used to cover working capital expenses and costs to remain compliant with New York’s COVID-19 regulations.
My business doesn’t qualify — what’s next?
If your business doesn’t meet the requirements set by NYFLF, consider these opportunities instead.
- Small business grants. The goal of NYFLF is to provide at least 60% of funding to minority- and women-owned businesses. In addition, there are also grants for minority-owned businesses, grants for women-owned businesses and grants for businesses affected by COVID-19.
- CDFI loans. If your business or nonprofit works with an underserved community, you may be eligible for a loan from a CDFI. CDFIs may also be able to help you apply for loans from the SBA or USDA.
- Bank loans. Banks typically have lower rates than other lenders, and many of our top picks for bank loans offer similar loan amounts and terms as NYFLF — but with higher starting rates.
Online and short-term lenders may also be helpful for businesses in a crunch, but these typically have much higher rates than other loan options.
Photo: Getty Images
