September 09, 2021
Today, President Joe Biden announced new changes to the COVID-19 Injury-Related Economic Disaster (EIDL) Loan Program, which provides long-term, low-cost loans to people affected by the pandemic of coronavirus (COVID-19). According to the White House, the changes will allow more companies to gain greater and more flexible support from the $ 150 billion in loanable funds still available in the program. The following statement was released by the Biden administration:
“First, the Small Business Administration (SBA) will increase the maximum amount of financing that a small business can borrow through this program from $ 500,000 to $ 2 million, which can be used to hire and retain employees, buy employees. inventory and equipment, and pay more. – the interest debt. This increase will help small businesses: An SBA analysis of current EIDL COVID borrowers who qualify for the increase shows more than 80% have 25 or fewer employees. The SBA will ensure that no small business has to start repaying these loans for two years after receiving the funding, so small businesses can weather the pandemic without having to worry about making payments.
Second, the SBA will make it easier for small businesses with multiple locations in hard-hit industries like restaurants, hotels, and gyms to access these loans. To ensure that taxpayer dollars are used to support businesses that really need help, the SBA has put in place stronger controls and will work closely with the SBA Inspector General to monitor the program.
Finally, to ensure Main Street businesses have more time to access remaining funds, the SBA will offer an exclusive 30-day access window where only small businesses looking for loans of $ 500,000 or less will receive. rewards after the launch of the new and improved loan product.
Click here to learn more about EIDL.
Today’s announcement also included a plan to streamline paycheck protection program (P3) loan cancellation for small loans.
According to the statement, “Through the P3, the SBA has made more than $ 11 million in loans to small businesses that can be canceled and written off if they use the funds to keep employees on the payroll. In order to receive the rebate, borrowers must complete an application with their PPP lender. The president’s plan will make it easier for over 3.5 million PPP borrowers with loans of $ 150,000 or less to write off their loans. “
Under the new approach, the SBA sends a pre-filled application form to the borrower who can review it, sign it, and send it back to the SBA, who then works with the lender to complete the remission process. Since the launch of the new process on August 4, more than 820,000 small businesses have applied for a rebate, with borrowers spending an average of six minutes on the application and 60% of applicants completing the process on their cell phones. The SBA expects more than 2.5 million additional small businesses to take advantage of this streamlined process in the coming months, helping them avoid unnecessary bureaucracy and avoid costly principal and interest payments on their businesses. ready.
Click here to learn more about PPP.
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