The Small Business Administration (SBA) has announced improvements to the COVID Economic Injury Disaster Loan (EIDL) program to better meet the needs of small businesses, and industries hit hardest by the pandemic. With the Delta variant, the struggle is far from over and many small businesses across the country are still in need of financial relief.
The COVID Economic Injury Disaster Loan program is on of many SBA programs offering assistance to businesses in need. The program is a federal disaster relief loan designed to better serve and support our small business communities still reeling from the pandemic, especially hard-hit sectors such as restaurants, gyms, and hotels.
“The SBA’s COVID Economic Injury Disaster Loan program offers a lifeline to millions of small businesses who are still being impacted by the pandemic,” SBA Administrator Isabella Casillas Guzman said in a press release.
“We’ve retooled this critical program – increasing the borrowing limit to $2 million, offering 24 months of deferment, and expanding flexibility to allow borrowers to pay down higher-interest business debt. We have also ramped up our outreach efforts to ensure we’re connecting with our smallest businesses as well as those from low-income communities who may also be eligible for the companion COVID EIDL Targeted Advance and Supplemental Advance grants totaling up to $15,000. Our mission-driven SBA team has been working around the clock to make the loan review process as user-friendly as possible to ensure every entrepreneur who needs help can get the capital they need to reopen, recover and rebuild,” Guzman continued.
The SBA is ready to receive new applications immediately from small businesses looking to take advantage of these new policy changes.
Changes to the COVID EIDL program
The low-interest and long-term COVID EIDL program has helped millions of small business owners survive the impacts of the pandemic with its flexibility and affordability – allowing entrepreneurs to hire and retain employees, and purchase needed equipment and inventory.
The SBA’s newest improvements will make the program even more flexible to meet the needs of struggling business owners. New improvements include:
- The SBA has increased the amount of funding that can be borrowed from $500,000 to $2 million for qualified applicants.
- The SBA has authorized COVID EIDL funds to be used to pay and prepay commercial debt and make payments on federal business debt in recognition of the financial reality many small businesses are facing during this crisis.
- Small businesses will have time to recover from COVID-19 impacts by further deferring payments – up to two years after your loan origination date.
- Additionally, to help ensure the smallest businesses can access this crucial capital, the SBA has created a one-month exclusive window for businesses requesting $500,000. During this time, approvals and disbursements will focus 100% on loans $500,000 or less until October 8th, upon which approvals and disbursements will be opened up to all loan sizes.
- Finally, to ease the COVID EIDL application process for small businesses, the SBA has established more simplified affiliation requirements to model those of the Restaurant Revitalization Fund.
You might be interested: How to still apply for Covid-19 Business Tax Credits ending Sept. 30
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How to apply
Eligible small businesses, nonprofits, and agricultural businesses in all U.S. states and territories can apply. Visit www.sba.gov/eidl to learn more about eligibility and application requirements. The last day that applications may be received is December 31, 2021. All applicants should file their applications as soon as possible.
For additional information on COVID EIDL and other recovery programs please visit www.sba.gov/relief.
“As your SBA Administrator and a former small business owner myself, my goal is to make you, America’s small businesses, feel like the giants you are in our economy with programs that meet you where you are,” said Guzman.
All business owners who have received previous loans through the SBA’s Paycheck Protection Program (PPP), Restaurant Revitalization Fund (RRF), or Shuttered Venue Operators Grant (SVOG) can still benefit from COVID EIDL. For no-cost assistance for the COVID EIDL program, and every other SBA program, go to www.sba.gov/local-assistance and connect with a local resource partner near you.