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PROTECT YOUR BUSINESS

What You Need to Know About the 2-Week SBA PPP Loan Exclusive for Small Businesses

5-minute read

Allison Grinberg-Funes

Allison Grinberg-Funes

23 February 2021

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On Monday February 21, the Biden-Harris administration announced that only small businesses with fewer than 20 employees will have access to the SBA Paycheck Protection Program (PPP) loan application from February 24, 2021 to March 9, 2021.

The current administration is hoping that by opening this two-week period of exclusivity to small businesses with less than 20 employees, it'll make it easier for lenders to connect with the businesses in need of assistance.

Larger businesses will be able to apply after the closure of this window until March 31, 2021.

What You Need to Know About The SBA PPP Loan 2-Week Window Announcement

The SBA Paycheck Protection Program (PPP) is offering a 2-week exclusive period for small businesses with 20 or less employees. These businesses will have access to lender applications before small businesses of a larger size.

Self-employed individuals, sole proprietors, and independent contractors can now benefit from the SBA PPP loan.

Because of how the PPP loans were previously calculated, many small business owners who worked by themselves received little, if any assistance.

Now, business owners like general contractors, hair stylists, independent retailers, and more, will have an opportunity to receive help.

The loan calculations will be revised and $1 billion dollars of relief will be set aside for business owners in these categories without employees who are in low-and-moderate income areas (LMIs).

The exclusion on non-fraud felony convictions of small business owners will be lifted.

Previously, individual business owners who owned at least 20% of a business, who are delinquent or have defaulted within the last 7 years on a federal debt, including student loans, were not eligible to apply for the PPP loan.

This will no longer be the case. The SBA and Departments of Treasury and Education will work together to remove this restriction and provide more accessibility to these loans.

The exclusion against business owners with certain past felonies will be lifted.

Previously, if a business owner owning 20% or more of a business had either an arrest or conviction for a felony related to financial assistance fraud within the past 5 years or any other felony within the past year, they were not eligible to apply.

That restriction will be lifted and those business owners with past arrests or convictions will now be eligible to apply for the SBA Paycheck Protection Program loan.

Non-citizen, lawful U.S. resident business owners will now have access.

For many business owners, being a lawful U.S. resident but non-citizen meant there was little guidance available on how to apply for the SBA PPP loan. For business owners who hold Green Cards or are in the U.S. on a visa, the application process wasn't clear.

Now, these business owners will have access to the small business PPP loan by using their Individual Taxpayer Identification Numbers (ITIN) in applying.

Small businesses with 20+ employees can apply for the SBA PPP Loan after March 9th.

While small businesses and non-profit organizations with fewer than 20 employees are being given a 2-week exclusionary application period for the small business paycheck protection program loan, if you have more than 20 employees, don't worry.

You'll still have until March 31st to apply.

Who May Qualify for a SBA Paycheck Protection Program Loan?

Many businesses are struggling due to the current economic climate in the midst of the COVID19 pandemic. But who qualifies to apply for an SBA PPP loan? According to the SBA, the following entity types are eligible:

  • Self-employed business owners, independent contractors, and sole proprietors
  • Any small business concern that meets SBA’s size standards (either the industry size standard or the alternative size standard)
  • Any business, 501(c)(3) non-profit organization, 501(c)(19) veterans organization, or tribal business concern (sec. 31(b)(2)(C) of the Small Business Act) with the greater of: 500 employees, or That meets the SBA industry size standard if more than 500
  • Any business with a NAICS code that begins with 72 (Accommodations and Food Services) that has more than one physical location and employs less than 500 per location

How Do I Apply for the SBA Paycheck Protection Program loan?

Note: The application process for an SBA PPP loan slightly differs depending on whether or not you've already applied and/or received funding. You can find more information on first vs second draw PPP loan applications here.

First time applicants:

If it's your first time applying for the small business PPP loan, follow these steps:

1.) The first step is to find a lender. You can:

  • Use SBA's Lender Match to find the right lender for you here
  • Search for lenders based on your location here

2.) Once you find a lender, identify a loan.

Before applying for the loan you choose, keep in mind that the lender may require you to produce collateral. This is why it's a good idea to consider getting business insurance.

Whether your collateral is your business's property or another asset, knowing that the collateral is protected by insurance coverage can put a lender at ease.

If you don't have business insurance coverage yet, consider getting:

General liability insurance. This type of policy can help cover cost from property damage, third party accidents, or bodily injury. For example, if a customer gets hurt while you're working and sues you, this coverage could help to cover their medical cost and associated legal fees.

Professional liability insurance. This type of policy helps to protect you from claims of negligence. For example, say you're a marketing consultant and your client blames you for the business losing money after a campaign you ran; they decide to sue. This coverage can help to cover legal representation and other costs.

If you're not sure what insurance coverage may be right for your business, don't worry. You can use our quote comparison tool that helps you compare quotes for FREE.

Get Insured in Under 10 Minutes

Get an affordable & customized policy in just minutes. So you can get back to what matters: Your business.

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3.) Download your application and apply for your PPP loan.

When you download the first draw PPP loan application, keep in mind that the latest version was created on February 17, 2021, indicated on the page.

Second time applicants:

If you've already applied for and/or received an SBA PPP loan, then you may be eligible for a second draw, according the SBA.gov website, if you:

  • Previously received a First Draw PPP Loan and will or has used the full amount only for authorized uses
  • Have no more than 300 employees; and
  • Can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020

You can download the small business PPP second draw loan application here.

Note: If you're unsure which steps to take in the small business PPP loan application process, SBA.gov has local business assistance you can utilize here.

Small Businesses Aren't Giving Up

We're heading into the one year mark of living and working through a pandemic, and if you're a business owner, we recognize how much hard work you've put into keeping your business afloat.

It's hard enough to start, grow, and protect a business during "normal" times, let alone during a global pandemic.

We hope that the administration providing small businesses with fewer than 20 employees access to this exclusive SBA PPP loan application window will help you continue forward with your goals and vision. We're rooting for you!

Allison Grinberg-Funes

Written by

Allison Grinberg-Funes

I’ve told stories since I learned to talk and written since I could hold a pen. As a small business owner myself - I'm a freelance writer and yoga teacher - I love contributing to the entrepreneurship community in different ways (including writing for Simply Business!). When I’m not drafting articles for SB, I can be found on my yoga mat, perusing an indie bookstore, and writing (with my cat nearby of course).

This content is for general, informational purposes only and is not intended to provide legal, tax, accounting, or financial advice. Please obtain expert advice from industry specific professionals who may better understand your business’s needs. Read our full disclaimer

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