The SBA, which this week began approving new PPP loans for minority and women-owned businesses, plans to open the process to all lenders starting Tuesday.
The US Small Business Administration announced Thursday that all banks and other lenders will be able to submit applications for federally guaranteed loans to the online approval portal starting next week.
As of Monday, January 11, the agency has only considered applications from community financial institutions that provide loans to businesses owned by minorities and women and those in low-income neighborhoods. It responds to complaints that the smallest of the small businesses had great difficulty obtaining P3 loans last year.
The latest version of the PPP consists of loans of up to $ 10 million for borrowers with 500 or fewer employees and a second loan for borrowers who have exhausted their first loan. To be eligible for a second loan, the borrower must have 300 or fewer employees and report a drop in income of 25% or more in a three-month period last year compared to the same period in 2019. The second loan can be up to $ 2 million per applicant, said Matt Coleman, spokesperson for SBA Region II, which includes New York State.
The deadline for getting a first or second PPP loan is March 31, he said.
The SBA also said Thursday that lenders with assets of $ 1 billion or less could begin submitting PPP applications on behalf of borrowers, starting Friday, Jan.15. The decision affects around 5,000 community banks, credit unions and agricultural credit unions, officials said.
The agency “is doing everything to ensure that small businesses have the emergency financial support they need to continue to navigate this period of uncertainty,” said outgoing SBA administrator Jovita Carranza.
The latest version of the P3 consists of over $ 284 billion in federally guaranteed loans with an interest rate of 1% and a term of five years.
More information is available at sba.gov/ppp.
