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SBA not accepting new loan applications as of April 16, 2020,
but additional funds expected to be appropriated early next week
As of Thursday, April 16, 2020, the SBA reported that it is: “Unable to accept new applications at this time for the Paycheck Protection Program (PPP) or the Economic Injury Disaster Loan (EIDL), including EIDL Advances, based on available appropriations funding.”
On Friday, April 17, 2020, Inc. and the US Chamber of Commerce hosted another installment in their National Small Business Town Hall webinar series. During the session, the US Chamber representative expressed that there is a high amount of confidence that more money will be appropriated by Congress for the PPP early next week. The amount reported is $250 billion.
We will be monitoring Congress closely with the expectation that the PPP loan program will be replenished. We will also be watching for additional details on the EIDL program.
Main Street Lending Program
Another loan option being discussed now is the Federal Reserve’s Main Street Lending Program. This program may be available beginning about May 1, 2020, according to the US Chamber.
Currently, program details are as follows:
The smallest loan amount is $1 million. During the Inc./US Chamber webinar on April 17, the US Chamber representative expressed that this minimum loan amount may be lower than $1 million once program details are finalized.
Interest rates may range from 2.5 to 4%.
The loan term is four years.
There is no loan forgiveness available.
Keep in mind that loan program details may change, which is something we have seen with both the PPP and the EIDL programs.
Employee Retention Credit
The Employee Retention Credit remains available as an option to businesses as well. It is equal to 50% of qualified wages with a cap of $10,000. Maximum credit per employee is $5,000. The Employee Retention Payroll Tax Credit cannot be used in conjunction with the Payroll Protection Program or any other loan where payroll costs are forgiven.
The Coronavirus situation is changing rapidly, as are the updates to various relief efforts. We will continue to monitor news and keep you updated as clarification is provided.
If you have questions, be sure to reach out to us. Our entire team is here to support and guide you!