A spokesperson for the U.S. Small Business Administration (SBA) has confirmed that the SBA is no longer accepting Paycheck Protection Program applications from lenders.
Background. The CARES Act established the Paycheck Protection Program (PPP) which permitted the SBA to provide loans to qualified businesses impacted by the coronavirus (COVID-19) pandemic. The 100% federally guaranteed loans must be used for payroll and certain non-payroll costs. The Consolidated Appropriations Act 2021 (CAA, 2021) included the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act (the Economic Aid Act) that authorizes additional funding to the program and extended the program until March 31, 2021. The Economic Aid Act also expanded access to First Draw PPP Loans to other entities, expanded additional eligible expenses, clarified terms, and authorized Second Draw PPP Loans for smaller borrowers.
The CAA provided $284.45 billion and ARPA provided $7.25 billion in direct funding to the PPP.
PPP funding status. Cecelia Taylor, Deputy Press Director/Team Lead, SBA Press Office, has informed Thomson Reuters that after serving more than eight million small businesses, general funding for the PPP has been exhausted and the PPP application portal has been closed for applications from most lenders.
Taylor added that the SBA will continue funding outstanding approved PPP applications, but new qualifying applications will only be funded through $9.9 billion that is set aside for Community Financial Institutions, financial lenders that serve underserved communities.
This includes Community Development Financial Institutions (CDFIs), Minority Depository Institutions (MDIs), Certified Development Companies (CDCs), and Microloan Intermediaries.