The current situation is very fluid and I wrote this article on April 5, 2020 regarding existing loan programs that are on the SBA website.  If you read this article later, the SBA assistance offers may have changed.

Special note, funding for the loan programs outlined below was provided via the 2 trillion dollar Cares Act.  It is very possible that this funding will be exhausted soon because so many businesses are in trouble. So if you are even thinking that you may need financial assistance, I would recommend applying for one of the programs below right away.

Economic Injury Disaster Loan

This loan provides up to 6 months of working capital for small businesses. Also, this loan provides an advance grant of $10,000 that is directly deposited into your bank account upon loan approval that DOES NOT need to be repaid.  This is a 30 year loan at a 3.75% interest rate, so the monthly payments will be relatively low.   At the start of the application, it indicates that it should take 2 hours and 10 minutes to complete. I filled an application out for one of my salon clients in less than 30 minutes.  Unlike the Paycheck Protection Program, the principal balance must be repaid.  Apply for this loan directly through the SBA website.

Paycheck Protection Program for salons and spas

Paycheck Protection Program

Paycheck Protection Program provides 2.5 months of average payroll costs to keep paying salon or spa employees and operating expenses such as rent and utilities.  Provided you meet certain criteria such as continuing to pay employees, the loan principal with be forgiven—in effect, the federal government is giving money directly to your business and you only need to pay the interest, which is at a 1% interest rate. This is a two-year maturity loan.

Special note: Independent contractors, such as booth renters, are eligible to apply for the Paycheck Protection Program.

Apply through your business bank if they are an SBA lender, otherwise search for “SBA lender and your city” for options.

Loan Approval Process

In terms of approval process, I have heard estimates of 1 week approvals and funding for Paycheck Protection Program loans and 3 to 4 weeks for Economic Injury Disaster Loans.

My recommendation, if you can afford to wait on funding for a few weeks, is to apply for the Economic Injury Disaster Loan. Because this loan provides more working capital versus 2.5 months of payroll for the Paycheck Protection Program.

The truth is no one knows how long this crisis will last.  Salon and spa owners would be better off  having more working capital to ride this out, then to run out of cash while their salon or spa is forced to be closed by the government due to Coronavirus.


The Small Business Development Center offers free consulting and is an excellent resource for small businesses. They have offices all over the United States. They also have experts to help you negotiate with landlords.

Published On: April 6th, 2020 / Categories: salons and spas /