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The two biggest stimulus programs for small businesses are the Small Business Administration’s (SBA) Economic Injury Disaster Loan (EIDL) and the Paycheck Protection Program (PPP). What are the differences between them?
EIDL
Economic Injury Disaster Loan- Maximum loan amount: $2 million
- Forgivable? $10k adv. grant included
- Collateral required? Possibly, depending on loan amount
- Credit check required? Yes
- Automatic Payment deferral: 12 months
- Where do I apply? SBA Website*
- Loan terms: 3.75%, up to 30 years (2.75% for non-profits)
- Approved uses of loan funds: Fixed debts (rent, utilities, etc.), Payroll, Accounts payable and some bills that could have been paid had the disaster not occurred.
PPP
Paycheck Protection Program- Maximum loan amount: $10 million
- Forgivable? Yes
- Collateral required? No
- Credit check required? No
- Automatic Payment deferral: 6 months
- Where do I apply? Directly from an approved lendor
- Loan terms: 1%, 2 years
- Approved uses of loan funds: Payroll expenses, Rent, Mortgage interest, and Utilities
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