SBA Closes New Disaster Loan Applications to Most Borrowers
May 12, 2020
The Small Business Association (SBA) resumed processing Economic Injury Disaster Loan (EIDL) applications that were submitted before the portal stopped accepting new applications on April 15 and will be processing those applications on a first-come, first-served basis. However, due to limitations in funding availability and the unprecedented submission of applications already received, new EIDL and EIDL Advance applications will now only be accepted for US agricultural businesses, according to the SBA announcement.
In response to the COVID-19 pandemic, small business owners in the United States, Washington DC, and territories could apply for an EIDL advance of up to $10,000. The advance, which does not have to be repaid, was designed to provide economic relief to businesses experiencing a temporary loss of revenue.
According to The Washington Post and people familiar with the situation who were not authorized to speak publicly, after initially telling businesses that individual disaster loans could be as high as $2 million, the SBA has now imposed a $150,000 limit without publicly announcing the change. SBA public affairs employees declined to comment to the newspaper on the new loan limit, and did not include it in a recent news release about the program.
The disaster loans program is different from the Paycheck Protection Program, which is run by private banks and regulated by the SBA.