Since the signing of the CARES Act, there’s been a constant flow of updates on the stimulus package and loan programs offered to small businesses. We understand it can be frustrating to process all the information coming in on top of everything else. Thus, find all the crucial information consolidated in the following quick breakdown.
To start off, what are the loans available to small businesses?
There are two types of loans available:
Paycheck Protection Program (PPP) loans aim to provide the liquidity that small businesses need to support employees throughout the coronavirus crisis and not have to resort to lay-offs.
Small Business Administration (SBA) Economic Injury Disaster Loan (EIDL) will help small businesses recover for broader economic injury related to the outbreak.
Here’s a quick breakdown of each loan program:
|Paycheck Protection Program (PPP)||Economic Injury Disaster Loan (EIDL)|
|Loan Period||February 15, 2020 to June 30, 2020||January 31, 2020 to December 31, 2020|
|Maximum Loan Amount||$10 million||$2 million|
|Eligible Borrowers||•Any small business, private or non-profit, veterans service group, or food and hospitality businesses with less than 500 employees or meets SBA size standards |
•Businesses in operation as of Feburary 15, 2020
|•Any small business, private or non-profit with less than 500 employees or meets SBA size standards |
|Debt Forgiveness||Loan forgiveness may be applied to 8 weeks’ worth of funds allocated for payroll cost, mortgage interest, rent, and utility expenses incurred after receiving funding.||Loan forgiveness may only be applied to the $10,000 emergency cash grant.|
The cash grants will also be credited towards the maximum forgivable amount under any PPP loan.
Information was derived from the following article posted and written by 48hourprint.