Paycheck Protection Program is now live

Paycheck Protection Program is now live
April 3, 2020

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The newly enacted Paycheck Protection Program (Small Business Loan Program) is now officially live. The new application was posted online last night (link below) and starting today, small businesses can apply for part of the nearly $350 billion in loans that are part of the recent stimulus package.

What you need to know

Go to your own bank first. Banks expect a high volume of application submissions. A few lenders are ready to go today; most will be ready next week. Other regulated lenders will become available as they enter the program. Lenders will likely be ready sooner, but all FDIC institutions are expected to be brought on board in the coming days. For now, the Credit Elsewhere requirement that you obtain at least a partial loan amount from another source is being waived.

The program is new. Apply as early as possible, and don’t be surprised if the process is a bit chaotic.

  • Borrow up two months of your average monthly payroll from 2019, plus 25% ($10M cap).
  • Interest rate is 1.00% fixed.
  • All payments are deferred for six months. The loan won’t be due for two years; no penalty for early repayment.
  • No collateral or personal guarantees required.

Who can apply

All businesses that have fewer than 500 employees, including nonprofits, sole proprietorships, freelancers, other self-employed individuals and veterans organizations. Some employers with more than 500 employees may qualify if they meet certain conditions.

Use these funds to cover:

  • payroll, including benefits
  • sick leave
  • interest on mortgage obligations, incurred before February 15, 2020
  • rent, under lease agreements in force before February 15, 2020
  • utilities, for which service began before February 15, 2020

When you can apply

When you can apply for and receive a loan through an SBA lender depends on your type of business.

  • April 3, 2020: Small businesses and sole proprietors
  • April 10, 2020: Independent contractors and self-employed individuals

If you apply with your bank, it will already have your information on hand, which will make the process go more smoothly. Click the links below to learn more. Then visit the U.S. Small Business Administration for more details, in-depth information and resources.

Read the full Interim Final Rule.
Download the Paycheck Protection Program Fact Sheet.
Visit the SBA website for a list of SBA lenders and resources.
Download the Paycheck Protection Program application.
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