$284 billion in Second round PPP Loans approved – and what this means for you and your customers.
During the initial Covid-19 devastation on small businesses, the PPP loans helped many of our customers, and more importantly – yours.
In many cases business owners were able to restructure their finances which allowed many of them to focus on expanding their business branding and advertising which is imperative to you, the sign maker.
With businesses staying open they needed essential graphics and decals for social distancing, which you the large format printers provide. The loan helps businesses stay open and stimulates growth.
This new round of funding will do the same for you personally or through your customers. Take a quick look at the list of qualifications for the loan and see how you can capitalize.
The program will be open to all small businesses on Tuesday January 19, 2021.
Do you know which industry gets the biggest loans?
Restaurants Receive Bigger Loan
Accommodation and Food Services sector can get bigger loans of up to 3.5x their average payroll costs while other businesses get only 2.5x.
You and your customers may be eligible for a second PPP loan even if you already received one in 2020.
If you never received a PPP loan now is the time to apply. Spread the good news. Help your customers get it too.
Here are a few things you should know:
Who is eligible for the loan?
- Any small businesses can apply, whether they already received a loan in the first round or if this is their second application.
- For a business to qualify for 2nd round PPP, they must meet these criteria:
- Not a public company
- No more than 300 employees (as opposed to 500 in the first round)
- Used their first PPP loans for approved uses (see below)
- Down at least 25% in revenue in one quarter of 2020 compared to 2019
What is the maximum loan amount?
- First time PPP loan applicants can be approved up to 2.5x their payroll costs, up to $10 million.
- Second round PPP loans will be approved up to 2.5x average monthly 2019 or 2020 payroll costs up to $2 million.
- Restaurants and Accommodation businesses get a bigger loan and can be approved for 3.5x average payroll costs up to $2 million.
What can the PPP loan be used for?
Loans can be used for payroll and other expenses, although the first round of PPP loans in 2020 were designated only for payroll.
- Help fund payroll costs, including benefits
- Mortgage interest
- Rent
- Utilities
- Worker protection costs related to covid-19
- Uninsured property damage costs caused by looting or vandalism during 2020
- Certain supplier costs and expenses for operations.
Will the PPP loan be forgiven?
For PPP loans to be fully forgiven, in the first 8-24 weeks of receiving the loan businesses must:
- Maintain employee and compensation levels
- Use at least 60% of the loan for payroll (the other 40% can be used for eligible expenses listed above)
Businesses can begin applying for loan forgiveness as soon as the full loan is spent.
The application for Second Draw PPP loans is open on Tuesday January 19, 2021 and the deadline to apply is March 31, 2021.