In 2021, a second round of Paycheck Protection Program (PPP) funding gives small businesses another chance at stimulus relief as the country continues to battle the effects of Covid-19. The Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act approved by Congress and signed into law by President Donald Trump allocates $285 billion for PPP loans to be funded through approved lenders like Liberty SBF.
As a non-bank lender with over 10-years of experience providing capital at a low cost to small business owners, Liberty SBF facilitated over 3,200 loans in the sum of more than $350 million in the last round of PPP lending. Since then, the company has invested in its PPP technology and built a secure, customized portal to process loan forgiveness for those customers. In addition, Liberty SBF has relaunched SBAPAYCHECK.com, already a leading source of news and information about PPP, and a web application for small business borrowers to apply for new Paycheck Protection Program relief funding.
Liberty SBF can process thousands of applications a day, at no cost to borrowers, to ensure they are ready to close without delay as soon as the new PPP loan program is ready to fund.
Round 2 Paycheck Protection Program Outline
The Small Business Administration is still working to finalize the rules and approved forms for the newest round of the PPP. After review of the new legislation, we have outlined the details provided thus far:
- The relief bill includes $285 billion in additional funds for PPP2 lending
- First-time borrowers as well as those who received PPP loans in the first rounds are both eligible
- Once again, the loans will be on a “first-come, first-served” basis
- Borrowers will have greater flexibility in using PPP2 loan proceeds
- The types of expenses eligible for loan forgiveness have been expanded
- Borrowers are required to spend at least 60% of their PPP loan proceeds on eligible payroll costs
- Permissible uses of PPP loan proceeds will include:
- Group insurance expenditures made on group life, disability, vision and dental insurance
- Expenditures to a supplier of goods deemed as
- Essential to the business’ operations, and
- Pursuant to a contract, order or purchase order in effect at any time before the PPP loan is disbursed
- Covered worker protection expenditures to comply with requirements established or guidance issued by the Department of Health and Human Services, the Centers for Disease Control, the Occupational Safety and Health Administration or a state or local government, subsequent to March 1, 2020. For example, maintenance or renovation of drive-through windows, air filtration systems, and physical barriers (sneeze guards)
- Operation expenditures for any business software or cloud computing service that facilitates a variety of business operations
- Property damage costs due to damage, vandalism or looting due to public disturbances that occurred during 2020 that were not otherwise covered
- In order to be eligible for a PPP Second Round loan, a borrower must be “a business concern, nonprofit organization, housing cooperative, veteran’s organization, [t]ribal business concern, eligible self-employed individual, sole proprietor, independent contractor, or small agricultural cooperative” and demonstrate:
- No more than 300 employees, and
- Suffered a 25% or more reduction in gross revenues in any quarter in 2020 compared to 2019
Again, Paycheck Protection Program Round 2 funds are on a first come, first served basis so Liberty SBF strongly encourages borrowers to pre-register for a new PPP loan by clicking here.