On Thursday, April 16, the Small Business Association stopped accepting new applications for the Paycheck Protection Program due to a lapse in appropriated funds. In under two weeks, the $349 billion in funding provided by the CARES Act was exhausted. The SBA stated that in under 14 days, they approved more than 14 years’ worth of loans.
Congress is currently negotiating the next COVID-19 legislation, commonly referred to as Phase IV. Treasury has requested an additional $250 billion for the PPP, which Congress is considering and seems to have wide support. Many organizations have issued supportive statements and calls for action.
Loans that have SBA approval but have not yet been funded will close; these loans already have funds reserved and just need to go through the banks closing process.
Money has also run out for the Economic Injury Disaster Loan (“EIDL”) Program. The SBA is working through their queue of applications on a first-come, first-served basis; however, they are not accepting any additional applications at this time.
We encourage those who are interested in a PPP loan, but have not yet applied, to consult with their bank or non-bank processor on whether they can apply to “get in line” for additional appropriated funds.
For more information on the PPP Loan see our PPP Frequently Asked Questions
You may also wish to listen to my remarks in our second webinar titled, Crisis Cash Flow Planning and CARES Act Update, where I share additional ideas on securing cash outside of the PPP/EIDL loan process.