New Paycheque Protection Program: Limit, Amount & How To Apply

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President Joe Biden announced a series of changes to the Paycheque Protection Program (PPP) that he hopes to make forgivable loans more accessible to small businesses.

The program was first introduced by the Trump administration, but has been criticized for its development too difficult for small minority-owned businesses to access support.

Biden removed an eligibility requirement that small businesses not making a profit could not receive a loan, when there was no such stipulation for large businesses.

The PPP also removed a restriction that prevented business owners who had previously been convicted of a non-fraudulent crime from applying for a loan. In some cases this has seen companies refused vital support because the owner had unpaid federal student loan repayments.

Biden said of his administration’s new focus on small business: “Small businesses are the engines of our economic progress. They are the glue, the heart and soul of our communities. But they get run over.

How much can I get under the PPP loan program?

As mentioned, the PPP program was introduced by Trump and aimed to provide a mechanism for small businesses to continue paying their workforce throughout the pandemic. In the December Emergency Relief Bill, $ 284 billion in federal funding was added to the program, but only half has been spent so far.

In total, $ 134 billion in forgivable loans were disbursed to 1.8 million small businesses who struggled to pay their salaries. It works at a average loan amount of approximately $ 74,000, which could mean the difference between survival and bankruptcy of a business.

The maximum amount you can claim is $ 2 million, but there are other eligibility limits. Funding can only be used to fund salaries of up to $ 100,000 per year. If your employees earn more than that, they can only receive up to $ 100,000 in support, prorated.

How to Apply for the Paycheck Protection Program

Along with changes to eligibility requirements, Biden announced the introduction of a 14 day window during which only small businesses can apply for help. From Wednesday February 24 to Wednesday March 10, only sole proprietorships and businesses with less than 20 employees will be offered loans by the Small Business Administration (SBA).

The actual process of applying for a PPP loan is quite straightforward, although it varies slightly depending on whether or not you have already received one.

First you need to find a lender, which can be done through a portal on the SBA website. AT find potential PPP lenders that offer SBA-backed financing, you can either be matched with a lender or search for lenders in your area.

Once you find a lender, you apply for a loan of the size you need, which can also be done online. If you have not yet received a PPP loan, you can apply for first draw PPP loans. Business owners who have received one in the past but need additional support should apply for a Second Draw P3 Loan.


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