COVID-19 Daily Communications

Information accurate as of 04/14/20

Highlights:

SBA Economic Injury and Paycheck Protection Loan Program Updates

  • High demand for Eco­nom­ic Injury Dis­as­ter Loans (EIDL) has led to impor­tant changes lim­it­ing the size of the pay­outs for some small-busi­ness own­ers. While small-busi­ness own­ers across Amer­i­ca line up to get their Pay­check Pro­tec­tion Pro­gram (PPP) loans–a process that has been a bit chaotic–the Trea­sury Depart­ment has tout­ed the EIDL as a stop­gap option.  Small busi­ness­es that apply for EIDLs can request an advance of up to $10,000.  Now, there are some caveats. The S. Small Busi­ness Admin­is­tra­tion’s Mass­a­chu­setts Dis­trict Office announced in a bul­letin on April 6 that, nation­wide, the SBA has decid­ed to imple­ment a $1,000 cap per employ­ee on the advance, up to a max­i­mum of $10,000.  So, a busi­ness with three employ­ees, for exam­ple, would be eli­gi­ble to receive only $3,000 up front, as opposed to the orig­i­nal­ly stat­ed $10,000.

 

  • There are rumors in the small busi­ness sec­tor that the total amounts of the EIDL loan will be capped at $15,000, may not be accu­rate. Below is a mes­sage that appears on the SBA loan doc­u­ment.  It states that the dis­burse­ments in the first two months will be lim­it­ed to $15,000.  There is no lan­guage to say that the loans are CAPPED at the $15,000.  As more infor­ma­tion becomes avail­able, we will know more, but as of now there is noth­ing to sug­gest the loans have a hard cap.
    • This mes­sage was shared by a cur­rent Bor­row­er from their SBA EIDL loan doc­u­ments:
      • Impor­tant mes­sage regard­ing your loan amount:Our nation’s small busi­ness­es and pri­vate, non­prof­it orga­ni­za­tions are fac­ing an unprece­dent­ed eco­nom­ic dis­rup­tion due to the COVID-19 out­break. The SBA is expe­ri­enc­ing a large vol­ume of appli­ca­tions for the Eco­nom­ic Injury Dis­as­ter Loan. Due to cur­rent appro­pri­a­tions for this pro­gram, the SBA will make ini­tial loan dis­burse­ments for two months of work­ing cap­i­tal up to a max­i­mum of $15,000 per appli­cant. This is in addi­tion to the Advance of up to $10,000 each small busi­ness and non-prof­it is eli­gi­ble to receive. By doing this, the SBA will ensure it is sup­port­ing the great­est num­ber of appli­cants dur­ing this dif­fi­cult time.

 

  • Bor­row­ers have begun to see the first wave of loan pro­ceeds arrive under the Pay­check Pay­ment Pro­tec­tion pro­gram this week, and monies under the plan are expect­ed to be exhaust­ed by Thurs­day or Fri­day of this week. Trea­sury Sec­re­tary Steve Mnuchin announced that $230 bil­lion of the $350 bil­lion allot­ted in the CARES Act for the Pay­check Pro­tec­tion Pro­gram has been used, and urged Con­gress to come to an agree­ment to replen­ish the fund­ing to keep small busi­ness­es open.
    • Pay­Pal on Fri­day announced that it has been approved by the Small Busi­ness Admin­is­tra­tion to par­tic­i­pate as one of PPP’s first non-bank lenders and has already begun dis­burs­ing loans to bor­row­ers. Cur­rent­ly, only exist­ing Pay­Pal mer­chants are eli­gi­ble to apply for the funds, which the com­pa­ny aims to issue with­in 24 hours of qual­i­fy­ing requests.
    • Intu­it on Fri­day also announced that it will par­tic­i­pate as a PPP non-bank lender through its Quick­books Cap­i­tal sys­tem. In a press release, the com­pa­ny said loans will be ini­tial­ly avail­able for “a sub­set of Quick­Books Online Pay­roll cus­tomers,” who will be able to apply as ear­ly as this week. One in 12 Amer­i­can work­ers are paid through our pay­roll sys­tems, which makes this an impact­ful place to start.

Businesses Helping Businesses:

 

 

  • View our cor­po­rate aid track­er for details on how busi­ness­es of all sizes and sec­tors are step­ping up to com­bat the Coro­n­avirus. Cor­po­rate dona­tions, both cash and in-kind, to sup­port med­ical pro­fes­sion­als and non-prof­its cur­rent­ly exceed $418 mil­lion.

 

NKY Cham­ber Dai­ly: http://www.nkychamber.com/news/covid-19/

US Cham­ber of Com­merce:  https://www.uschamber.com/members/small-business