Smaller businesses can still apply for the Paycheck Protection Program

Time is running out for smaller businesses to access the priority application period for the Small Business Administration’s Paycheck Protection Program.

But these businesses, as well as small businesses of all sizes, will still be able to apply for forgivable loans outside the priority window.

The 14-day priority window announced by the Biden-Harris administration last month ends at 5 p.m. ET today, March 9. During those two weeks, only businesses with fewer than 20 employees could apply for forgivable loans through PPP, a special period aimed at helping women and minority-owned businesses access funds.

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Even after this window closes, it will still be possible for these companies to apply for and receive funding under the program. While they may compete with larger companies for cash, lenders don’t expect the program to run out of cash until the March 31 expiration date.

This year, until March 7, the SBA had approved more than 2.4 million PPP loans totaling nearly $ 165 billion. That’s about 58%. 100 of the $ 284 billion allocated to the program when it reopened in January.

“We could cross $ 200 billion, but I think it’s probably going to be between $ 50 billion and $ 75 billion,” said Sam Sidhu, chief operating officer of Customers Bank, headquartered in Phoenixville, Pa. .

Smaller companies can still apply

This is important for smaller businesses that wanted to take advantage of the priority request window but delayed submitting documents.

For example, as the special application period opened on February 24, the expansion of eligibility for those who had had student debt issues, had been convicted of a non-fraudulent felony, or were homeowners. non-citizen business did not take effect until the first week of March, confusing for some. An updated loan calculation formula that meant more money for businesses with an IRS 1040 Schedule C form was not announced by the SBA until March 3.

Beyond that, the administration was not ready to process forms with the new calculation formula until March 5, leaving sole proprietors with little time to access the priority application period.

But these companies can still apply before the program deadline, Sidhu said, and shouldn’t think that because they missed the priority window they won’t get a loan.

Be aware of the deadline

The March 31 expiration date for the entire program is a concern for many lenders.

“The looming March 31 deadline is a much bigger issue,” said Chris Hurn, managing director of Fountainhead Commercial Capital, a non-bank lender. He added that he was concerned the date would be enough for all small businesses to take advantage of the new rules or request additional funding rounds, which could be crucial for their survival.

Additionally, lenders are also under pressure to process each other’s loans as quickly as possible, which has been difficult with the changing rules.

“Everyone’s bandwidth has already been significantly stretched over the past year with this program,” Hurn said.

So far, the Biden administration has not indicated that the program will be extended, a move that would have to be approved by Congress.

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