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