Biden identifies smaller firms in PPP loan reviews
Biden establishes a two-week window during which only companies with fewer than 20 employees can apply for PPP forgiveness loans.
WASHINGTON, DC – President Joe Biden will announce additional coronavirus relief measures to help smaller businesses and sole proprietors across the country left behind in previous rounds of aid on Monday.
For two weeks starting Wednesday, the Small Business Administration (SBA) will accept paycheck protection program (PPP) forgivable loan applications from those businesses with less than 20 employees, ensuring they will not be ousted by the paycheck protection program (PPP). large companies, according to an announcement.
“This will give lenders and community partners more time to work with smaller businesses to submit their applications, while ensuring that larger businesses eligible for PPP will still have enough time to apply and receive support before the expiration of the program on March 31. 2021 ”, we read in the SBA announcement.
The SBA said it is strengthening relationships with lending partners to advance equity goals, provide finance effectively and prevent fraud, waste and abuse. To meet these goals, four additional changes were also announced to open up the PPP to more underserved small businesses than ever before:
- Allow sole proprietors, independent contractors and self-employed workers to receive more financial support by revising the PPP funding formula for these categories of applicants;
- Remove an exclusionary restriction on access to P3s for small business owners who have previously been convicted of non-fraud crimes, in line with a bipartisan congressional proposal;
- Eliminate restrictions on access to P3s for small business owners who have struggled to repay their student loans by removing student debt default as a barrier to P3 participation; and
- Ensure access to non-citizen small business owners who are legal residents of the United States by specifying that they can use the Individual Tax Identification Number (ITIN) to apply for the PPP.
When the PPP was launched in April 2020 on a $ 3 trillion relief bill, its initial $ 349 billion ran out within two weeks. Congress approved an additional $ 320 billion in May, but the program expired in August with about $ 130 billion in unused funds.
The latest PPP, launched Jan. 11, has already disbursed $ 133.5 billion in loans, or about half of the $ 284 billion allocated by Congress, with an average loan of less than $ 74,000. But officials in the Biden administration said there are still many minority and very small businesses in low-income areas that have not been able to receive assistance.
The last day to apply for a PPP loan is March 31, according to SBA guidelines.