PPP Flexibility Act Eases, Extends Key Provisions
A new joint statement from U.S. Department of Treasury and SBA outlines changes to the Paycheck Protection Program (PPP). Changes are intended to streamline the process of helping businesses access financial resources to keep employees on payroll and continue operations.
The SBA will soon issue new rules and guidance, a modified borrower application form, and a modified loan forgiveness application. Other changes include the following:
- Extend period for loan forgiveness after disbursement from 8 to 24 weeks.
- Lower percentage of loan proceeds that must be used for payroll costs.
- Provide two safe harbors from reductions in loan forgiveness when full-time equivalent employees are unable to return to work due to reduction in business activity.
- Increase to five years maturity of PPP loans that are approved by SBA (based on date SBA assigns loan number) on or after June 5, 2020.
- Extend deferral period for borrower payments of principal, interest and fees on PPP loans.
- In addition, the new rules will confirm that June 30th remains the last date on which a PPP loan application can be approved.
For more detail, read the full statement here.
More than $130 billion in Paycheck Protection Program funds are available to borrowers through June 30, 2020. Find a PPP lender at www.sba.gov/paycheckprotection/find