The second round of the Paycheck Protection Program (PPP) loan has rolled out and many carriers who meet the qualifications can apply to obtain funding. However, for those who still want extra cash or don’t qualify for the second round of PPP loans, there are other feasible options to solve cash flow issues.
Second Round of PPP Funding: Qualifications
The pandemic has placed financial strains on small businesses because of strict bank requirements, among other reasons. Many small businesses took advantage of the first round of PPP loans but found that the loan was not enough to cover business-related expenses and in most cases the money had to be paid back. Those who did manage to get the loans forgiven still had trouble maintaining their business afloat. In addition, small businesses that qualified for the loan also had issues with prompt payments because it took several months before they could receive their funding.
Now, with a second round of PPP loans, small companies are hoping to ease the uncertainty of cash flow. A second round of PPP loans will encourage trucking companies to stay on the road and continue delivering critical goods. It will also prepare them for any unexpected shifts in the transportation sector as the economy recovers. However, those who received money the first time around and want another chance at the PPP loan might encounter more restrictions. In particular, trucking companies experienced a strong market in 2020 which might affect their eligibility for the second loan. Whatever the reason, a second round of PPP loans might not reach some small companies or it might raise cash flow issues as did the first round of the PPP loan.
Other Funding Options
Companies that don’t qualify for a second PPP loan or find that the loan isn’t enough, could end up struggling to maintain working capital. Moreover, clients are also experiencing uncertainty and therefore may also be struggling with paying invoices on time, further contributing to low working capital for small companies.
The solution is factoring. Factoring can help your business obtain immediate cash flow without going into debt. At Single Point Capital we will take on the burden of collecting invoices and you can get paid immediately. For more information, contact our offices today.