2021 Paycheck Protection Program Information
The Small Business Administration, in consultation with the U.S. Treasury Department, opened the Paycheck Protection Program loan portal on Monday, Jan. 11. The PPP is a loan designed to provide a direct incentive for small businesses to keep their workers on the payroll. SBA will forgive loans if all employee retention criteria are met, and the funds are used for eligible expenses.
The PPP loan portal system is initially accepting First Draw PPP and Second Draw PPP loan applications from participating CFIs, which include Community Development Financial Institutions (CDFIs), Minority Depository Institutions (MDIs), Certified Development Companies (CDCs), and Microloan Intermediaries.
- Accepted applicants can receive 2.5X their average monthly payroll (including medical, dental, vision, and life insurance costs) as a forgivable loan.
- The applicant can choose whether to use any length between 8 or 24 weeks for their covered period. In that covered period, 60% of the loan must be used on payroll in order to be fully forgiven at the end of the covered period.
- The loan term is 5 years with 1% interest if unforgiven.
- The deadline to apply for the first and second draw is March 31, 2021, although funds could be depleted before then.
- EIDL advances are no longer subtracted from PPP forgiveness.
- Further assistance for NAICS Code 72: Accommodation and Food Services businesses allows for up to 3.5X average monthly payroll.
- Eligibility has been expanded to include 501(c)(6)’s and nonprofits including religious organizations.
- The loan is forgiven if used on eligible expenses in the stated covered period, with a minimum of 60% spent on payroll costs.
You can apply through any existing SBA 7(a) lender or through any federally insured depository institution, federally insured credit union, and Farm Credit System institution that is participating. Other regulated lenders will be available to make these loans once they are approved and enrolled in the program. You should consult with your local lender as to whether it is participating in the program.
Must show a 25% loss
- Can compare all of 2020 vs. 2019 or any specific quarter of 2020 vs. the same quarter in 2019
- Must have fewer than 500 employees
- The maximum loan amount is $10 million
- The first draw application is open.
A recipient of the first round of PPP may be eligible for the second-round if:
- They have used the funds from their first PPP loan.
- Have fewer than 300 employees
- Can show a 25% loss between 2020 and 2019 (you may subtract out your Round 1 PPP or EIDL loans)
- The maximum loan amount is $2 million.
- The second draw application is open.
Local Bank Support
If you need assistance with your loan, please contact your personal bank or view the list of participating banks & the contact person(s) below.
Information provided by https://www.growstillwater.org/page/home/paycheck-protection-program.