The Small Business Administration (SBA) has retooled the Economic Injury Disaster Loan (EIDL) program to better serve and support businesses still reeling from the pandemic.
Starting October 8, the EIDL program will have a new loan maximum of $2 million, up from $500,000. In addition, new adjustments to the program include expanded use funds to pay and prepay business debt and it will allow for 24 months of deferment. For camps that have incurred higher interest rate debt as a result of the pandemic, the revamped EIDL loan program may provide significant relief.
Key Changes to the EIDL Program
- Increase EIDL Cap. The EIDL cap increased from $500,000 to $2 million. Loan funds can be used for any normal operating expenses and working capital, including payroll, purchasing equipment, and paying debts.
- Expansion of Eligible Use of Funds. EIDL funds will now be eligible to prepay commercial debt and make payments on federal business debt.
- Implementation of Deferred Payment Period. Business owners will not have to begin COVID EIDL repayment until two years after loan origination so that they can get through the pandemic without having to worry about making ends meet.
- Affordable Terms. Small business interest rate of 3.75% and nonprofit organization interest rate of 2.75% at 30-year maturity. Interest continues to accrue during the deferment period and borrowers may make full or partial payments if they choose.
Please visit the SBA’s COVID-19 EIDL page for more information and to apply for the EIDL.