Registration is Open for Dec. 8, 2021 SBA Delaware Webinar Detailing SBA’s COVID EIDL Loans, Loan Increases and Application Process

BY: SBA Delaware District Director John Fleming

Time is running short for small businesses impacted by the COVID-19 pandemic to apply for long term, low interest Economic Injury Disaster Loans (EIDL) of up to $2 million from the U.S. Small Business Administration. Loan applications for initial COVID EIDL loans, increases to previously approved COVID EIDL loans and associated Targeted EIDL Advances must be received by SBA by December 31, 2021 (or when funds are exhausted, whichever occurs first). Supplemental Targeted Advance applications will not be accepted or processed after December 31, 2021, including reconsiderations. We strongly encourage eligible small businesses to apply as soon as possible, but no later than December 10, 2021. SBA urges small business owners to apply for COVID EIDL loans increases and advances without delay. To provide guidance, SBA Delaware is offering its ‘Last Opportunity to Apply for an EIDL Loan’ webinar detailing SBA’s COVID EIDL loan, Targeted and Supplemental Advances (Grants),  loan increases, and application process; to register, visit: U.S. Small Business Administration Events | Eventbrite or https://www.sba.gov/de.

COVID EIDL Loans

Under SBA’s COVID EIDL loan program, small businesses can qualify for up to a $2 million working capital loan to pay expenses that they would have been able to pay had the COVID-19 pandemic not occurred. Under the COVID EIDL Program, the maximum loan amount for which a business is eligible is the product of its 2019 revenue subtracted by its cost of goods sold times two. EIDL loan proceeds may be used for expenses like: credit card payments, increased wages, accumulated rent, and increased cost of goods sold. EIDL borrowers get a long term of 30 years to repay the loan with a fixed low interest rate of 2.75% for non-profits and 3.75% for small businesses. 

EIDL Targeted Advances and Supplemental Targeted Advances

Small businesses that apply and are eligible for SBA COVID EIDL loans can also qualify for the agency’s Targeted Economic Injury Disaster Loan and Supplemental Targeted Advance grants, even if those businesses do not ultimately get approved for or accept the EIDL loan itself. The Targeted EIDL Advance provides funds of up to $10,000 for working capital and normal operating expenses that does not have to be repaid. Similarly, SBA’s Supplemental Targeted Advance provides qualifying program applicants additional working capital/normal operating expense funds up to $5,000, which does not have to be repaid.

Once a business applies for a COVID EIDL, the SBA e-mails the applicant an invitation to apply for one of the EIDL advances – the EIDL Targeted Advance and the Supplemental Targeted Advance. As detailed below, both Advance programs require that applicant small businesses be located in a low-income area, which can be determined by using the SBA’s online mapping tool.

To qualify for a Targeted EIDL Advance, a business must:

• Be in a low-income area;
• Have suffered a reduction in revenue greater than 30 percent over an 8-week period beginning on March 2, 2020, or later; and
• Have 300 employees or less.
• Applications for the Targeted EIDL Advance must be submitted on or before December 31, 2021 in order to be considered.

To be considered for the Supplemental Targeted Advance, a business must have applied or apply for the Targeted EIDL Advance. To qualify for SBA’s Supplemental Targeted Advance, a business must:

• Be in a low-income area;
• Have suffered more than a 50 percent economic loss over an 8-week period beginning on March 2, 2020, or later, compared to the same period in the prior year; and
• Have 10 employees or less.
• It should be noted that SBA cannot process Supplemental Targeted Advance application after December 31, 2021. Therefore, you are strongly encouraged to submit your request on or before December 10, 2021 in order to be considered for this Advance.

These programs are much-deserved good news for America’s small businesses. To take the next step to secure an EIDL loan, increase and/or advance for your small business, log into SBA’s online EIDL portal: Login – SBA Economic Injury Disaster Loan Portal Application.