|1. SBA’s EIDL disaster loans
This next round of funding will allocate $50 billion to the EIDL program, but contrary to the PPP program where your lender can get ready to submit your application, there is no existing queue for EIDL. This means that as soon as funding gets approved, the SBA will likely immediately turn applications back on: monitor the SBA website and get ready to apply for an EIDL loan in the next few days.
2. Applying for or receiving both a PPP and an EIDL loan
Yes, you can apply to both a PPP and an EIDL loan, but make sure to use each set of funds for different purposes. For example, if you hope to maximize PPP forgiveness, you will likely use it mostly for payroll, and will likely use EIDL funds for non-payroll expenses like inventory, accounts payable etc. Detailed and clear accounting practices will be critical to prove the forgiveability of the funds.
Please note that the law is not clear as to whether you can use EIDL funds for payroll after you have exhausted PPP funds or after the 8-week period. We recommend you use funds for different expense types for now, and this questions will hopefully be officially clarified soon.
3. Future rounds of funding
The new round of funding should replenish the PPP and EIDL programs for the short term. Just know that Congress called this new round an “interim measure” which also gives us hope for future rounds of additional funding.
4. Main Street Lending Program: for large companies
This new program should be available at the end of this month and is mostly applicable to larger companies with a minimum loan amount of $1 million, a relatively low interest rate and no forgiveness. If you need more information, reach out to us or ask your financial consultants. Here’s more information with relevant fact sheets from the Federal Reserve.