On Monday, the Biden-Harris Administration announced changes to the Paycheck Protection Program (PPP) intended to assist the smallest businesses in the U.S. who have been previously unable to secure PPP loans.
Starting Wednesday, February 24, only businesses with fewer than 20 employees may apply for funding through the PPP over the following two-week period. Many of these smaller businesses have struggled to secure the funds and limiting applications to businesses under 20 employees will allow them to be a focus for lenders during this two-week window.
Independent contractors, sole proprietors and self-employed individuals will also be a focus during this time. Recognizing that 70 percent of businesses in this category are owned by women and people of color, the administration will be re-calculating the loan formula to ensure it better serves minority-owned businesses. A $1 billion set aside has also been earmarked for these businesses located in low- and moderate-income areas.
The renewed efforts will allow small business owners with prior non-fraud felony convictions and those with delinquent federal student loans to obtain funding through the PPP. The SBA will also be providing guidance to lenders on how to process loan applications of ITIN-holding U.S. residents. The PPP statutes provide for access to funding for lawful U.S. residents, but lenders haven’t had clear guidance from the SBA in the past for processing these loans.
If you are a small business owner with fewer than 20 employees and have been previously unable to receive PPP loan funds, now is the time to re-apply. Learn more about the recent PPP changes in the White House statement and contact us if you have questions or need assistance with securing a loan.