Starting today, April 27, 2020 at 10:30 a.m., integrators can once again begin applying to their lending institutions to access the additional $370 billion in coronavirus funds made available for small businesses to weather the COVID-19 outbreak. This round of funding is scheduled to end by June 30, 2020 (with exceptions for agricultural lending), but some lending institutions expect the funding could run out in 14 days.
The Paycheck Protection Program and Health Care Enhancement Act (PPP & HCE Act) was signed into law by President Trump on April 24, 2020. It makes available $310 billion in additional coronavirus funding to restart the Paycheck Protection Program (PPP) for businesses with fewer than 500 employees, as well as $60 billion for the Small Business Administration’s Economic Injury Disaster Loans (EIDL) and grants program. Of that $60 billion, $10 billion is available for emergency grants of up to $10,000 that do not have to be repaid, while $50 billion of the money funds EIDL loans.
The qualifications to receive the PPP funds and the EIDL loans have not changed from the previously enacted $2 trillion CARES Act legislation in early April, which ran out of money on April 16. In all, this is the third round of government funding in regards to the coronavirus pandemic.
According to small businesses were unable to receive their PPP money or SBA loans and media reports indicated that large lending institutions had received priority access to the funds versus small banks. In this $310 billion of additional PPP funding, $60 billion of it is designed for use by small and mid-size lenders in order to ensure that borrowers who work with small and mid-size lenders are not placed at a disadvantage in the SBA submission process. This stipulation could be advantageous to integration companies, which are more likely to utilize smaller local lenders.
Banks report they are expecting a heavy pipeline of applications again for coronavirus funds. Plus, there are many applications already in the works that were left unfunded from the previous CARES Act.