The Small Business Administration and the U.S. Department of the Treasury announced that the Paycheck Protection Program (PPP) reopened Monday for new borrowers and certain existing PPP borrowers.
To promote access to capital, only community financial institutions will be able to make First Draw PPP Loans to begin with, and Second Draw PPP Loans today (Wednesday). The PPP will open to all participating lenders shortly thereafter.
This round of the PPP will prioritize millions of Americans employed by small businesses by authorizing up to $284 billion toward job retention and certain other expenses through March 31, and by allowing certain existing PPP borrowers to apply for a Second Draw PPP Loan.
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©(6) businesses, housing cooperatives, direct marketing organizations and other types of organizations.
The PPP provides greater flexibility for seasonal employees, and certain existing PPP borrowers can request to modify their First Draw PPP Loan amount. Certain existing PPP borrowers are now eligible to apply for a Second Draw PPP Loan.
Businesses qualifying for Second Draw PPP Loans should have previously received a First Draw PPP Loan and will or have used the full amount only for authorized uses, have no more than 300 employees and can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020.