It’s Baaaackkk! The much-awaited and politically fraught Paycheck Protection Program (PPP), which allowed so many independent run specialty shops and other small businesses to remain open during the height of the COVID-19 pandemic in mid-2020, re-opened last week for new borrowers and certain existing PPP borrowers
One difference anyone applying last week may have noticed is that the U.S. Small Business Administration (SBA), in consultation with the Treasury Department, in order to promote access to capital, mandated that initially only community financial institutions were able to make First Draw PPP Loans on Monday, January 11, and Second Draw PPP Loans on Wednesday, January 13.
The PPP plans to open to all participating lenders shortly thereafter. This round of the PPP continues to prioritize millions of Americans employed by small businesses by authorizing up to $284 billion toward job retention and certain other expenses through March 31, 2021, and by allowing certain existing PPP borrowers to apply for a Second Draw PPP Loan.
Key PPP updates include:
- PPP borrowers can set their PPP loan’s covered period to be any length between eight and 24 weeks to best meet their business needs;
- PPP loans will cover additional expenses, including operations expenditures, property damage costs, supplier costs, and worker protection expenditures;
- The Program’s eligibility is expanded to include 501(c)(6)s, housing cooperatives and direct marketing organizations, among other types of organizations;
- The PPP provides greater flexibility for seasonal employees;
- Certain existing PPP borrowers can request to modify their First Draw PPP Loan amount; and
- Certain existing PPP borrowers are now eligible to apply for a Second Draw PPP Loan.
A borrower is generally eligible for a Second Draw PPP Loan if the borrower:
- Previously received a First Draw PPP Loan and will or has used the full amount only for authorized uses;
- Has no more than 300 employees; and
- Can demonstrate at least a 25 percent reduction in gross receipts between comparable quarters in 2019 and 2020.
One of the best resources about the Paycheck Protection Program has been put together by the National Sporting Goods Association at nsga.org.
More information is also available at
We recommend checking out both resources.