Disaster Preparedness Finance

Covid relief update: EIDL grants program ends, but loan applications will still be processed

The U.S. Small Business Administration announced  this weekend that it will discontinue issuing advances, or small grants, through the Economic Injury Disaster Loan (EIDL) Advance program. The program provided U.S. small businesses, non-profits and agricultural businesses a total of $20 billion in emergency funding. Loan applications will continue to be accepted, however.

The EIDL Advance provided grants of $1,000 per employee up to a maximum of $10,000.  Recipients did not have to be approved for a loan to receive the Advance, and the Advance, which would not need to be paid back, provided an interim source of funds while applicants awaited a decision on their loan application.

“Following the enactment of COVID-19 emergency legislation, the SBA provided nearly six million small businesses employing 30.5 million people with $20 billion through the unprecedented EIDL Advance program,” Administrator Jovita Carranza said in a statement.  “This program, built from the ground up in less than two weeks, assisted millions of small businesses, including non-profit organizations, sole proprietors and independent contractors, from a wide array of industries and business sectors.”

Having allocated the full $20 billion that was appropriated by Congress, SBA will discontinue making EIDL Advances to new applicants.  By law, the SBA is not permitted to issue new EIDL Advances once all program funding has been obligated.

However, EIDL loan applications will still be processed even though the Advance is no longer available. The SBA said the loan portion of the EIDL program continues to have funds available at very affordable terms, including a 3.75% interest rate for small businesses and 2.75% for non-profit organizations, a 30-year maturity, and an automatic deferment of one year before monthly payments begin.  Eligible small businesses and non-profits are encouraged to apply here.

As of late June, the Florida SBDC at FIU had helped nearly 300 small businesses in Miami-Dade and Monroe counties obtain more than $28 million in COVID-19 assistance, including $7 million in SBA EIDL loans.


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