The Small Business Administration (SBA) has announced that it has closed its Economic Injury Disaster Loan (EIDL) Advance program after granting the entirety of its $20 billion in emergency funding to nearly 6 million small businesses, including non-profit organizations, sole proprietors, and independent contractors impacted by the COVID-19 pandemic.
The EIDL Advance program provided Emergency Economic Injury Grants of up to $10,000 ($1,000 per employee, for the first 10 employees) to businesses awaiting a decision on their EIDL application. Recipients of these emergency grants do not have to repay the funds, even if the business is eventually denied an EIDL.
The SBA will continue to accept EIDL applications, which offer a 3.75% interest rate (2.75% for non-profits), a 30-year maturity, and an automatic deferment of one year before monthly payments begin.
Organizations that receive Paycheck Protection Program forgivable loans and EIDL loans must deduct the EIDL funding from the amount eligible for PPP loan forgiveness.
CRR has been closely following all guidance as it is released in order to best support our clients. If you have questions about the EIDL program, leave a comment below, or feel free to contact me directly. You can also visit our COVID-19 Resource Center for the latest updates, alerts, and impacts.