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Additional funding for SBA loans receives Senate approval

Published April 21, 2020
House and presidential agreement now needed.

WASHINGTON, D.C. (BRAIN) — The Senate on Tuesday afternoon agreed to a COVID-19 relief package that will allocate $310 billion to the depleted Paycheck Protection Program to help small businesses.

An additional $60 billion will be added to the Small Business Administration's other program, the Economic Injury Disaster Loan.

The $349 billion PPP loan program ran out of money Thursday. The relief package now goes to the House, which will review it Thursday. Then it goes to President Trump for his expected approval.

The $484 billion relief package also includes a requirement that the Trump administration develop a national COVID-19 testing protocol and provide additional funds to hospitals.

In just under two weeks, the SBA said more than 1.6 million small businesses in all 50 states and territories received payroll assistance in forgivable loans. Nearly 5,000 lenders took part, with about 20% of the loans approved by lenders with fewer than $1 billion in assets and about 60% approved by banks with $10 billion or fewer in assets. No lender accounted for more than 5% of the total dollar amount of the program.

The SBA also said Thursday it would not accept any more EIDL applications. The low-interest EIDL offered up to $10,000 to businesses experiencing a temporary revenue loss. Both programs were offered to qualified small businesses with fewer than 500 employees. Businesses applying for the EIDL in certain industries may have more than 500 employees if they meet the SBA's size standards for those industries.

The PPP loans are forgivable if all employees are kept on the payroll for eight weeks and the money is used for payroll, rent, mortgage interest or utilities.

PeopleForBikes, which has held three webinars in the past few weeks to provide loan information for retailers, said they should ensure their PPP and EIDL materials are ready to submit when new loans and grants officially become available.

Topics associated with this article: Coronavirus

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