The SBA’s Economic Injury Disaster Loan (EIDL) Program now includes assistance for small businesses affected by COVID-19, with low-interest loans and grants to provide support and to help businesses overcome related revenue losses.
The SBA’s Economic Injury Disaster Loan (EIDL) Program provides small businesses (500 employees or less) and nonprofits with low-interest loans of up to $2 million that can provide vital economic support to small businesses to help overcome the temporary loss of revenue they are experiencing due to COVID-19. EIDL interest rates are 3.75% for small businesses and 2.75% for not-for-profits.
As part of the COVID-19 relief effort, borrowers can also apply for an Emergency EIDL Grant from the SBA to request an advance on the loan of up to $10,000.
SBA will determine the amount of grant based on the information provided by the borrower.
SBA must distribute the Emergency EIDL within three days of the request.
The advance will be considered an Emergency EIDL grant.
The borrower will not be required to pay back the Emergency EIDL Grant even if they are subsequently denied for an EIDL loan.
In advance of disbursing the advance payment, the SBA will require that the borrower file a certification, under penalty of perjury, that they are eligible to apply for an EIDL loan.
The following types of businesses are eligible to apply for the EIDL:
Small agricultural cooperatives,
Small aquaculture businesses;
Most private non-profit organizations
ESOPs with fewer than 500 employees;
Any individual operating as a sole proprietor; and
An independent contractor during January 31, 2020 to December 31, 2020.
The SBA generally defines a small business as an entity with 500 employees or less. There are, however, specific size standards depending on the type of business.