A Breakdown of the SBA Paycheck Protection Program

Published in Member Communities on April 02, 2020

The Paycheck Protection Program (PPP) is the third phase of the government’s $2.2 trillion government’s relief package, the Coronavirus Aid, Relief, and Economic Security (CARES) Act. It was created to help small businesses cope with the COVID-19 outbreak. The PPP sets aside nearly $350B to be used by the Small Business Administration (SBA) to provide government backed and potentially forgivable loans to businesses throughout the country. Businesses can begin applying for these loans on Friday, April 3, 2020 through their lending institution of choice. The loans will be available to businesses through June 30, or until the money is gone, whichever comes first.

This portion of the act was designed to help small businesses cover certain operating expenses and keep their employees on the payroll while their business is disrupted due to the pandemic. Some key features of the program include:

  • Available to small businesses, nonprofits, sole proprietorships, Tribal businesses, veterans’ organizations, and independent contractors, with 500 or fewer employees
  • Maximum loan is equal to 2.5 times the employer’s average monthly payroll
  • Capped at a max of $10M per business
  • Loans can be used to cover payroll (wages, salaries, retirement contributions, and health benefits including medical leave)
  • Loans can also be used to cover things like rent, utilities, and mortgage interest
  • No collateral or personal guarantee required
  • No fees/2-year maturity, and 0.5% interest rate
  • Loans are fully insured/backed by the federal government
  • Loans are forgivable if used properly

If you want to get started on your application, download the application form.

Click here for additional Q&A, and click here for a webinar recording that divers deeper into this program and its various features and benefits.

From Our Experts

Driving Value Through Insights: A Vision for HME and DME Providers thumbnail Driving Value Through Insights: A Vision for HME and DME Providers VGM experts generate insights through market research and monthly surveys, equipping HME and DME providers with the knowledge they need to succeed. 2025 O&P Grant Application Period Now Open thumbnail 2025 O&P Grant Application Period Now Open OPGA and Össur have announced the application period is now open for two grants available for U.S.-based O&P professionals. We're Not Gonna Take It Anymore thumbnail We're Not Gonna Take It Anymore What choices do we have as an industry tied to insurance contracts and CMS requirements for maintaining billing privileges? Heartland 2025: e-Prospectus and Schedule Now Available! thumbnail Heartland 2025: e-Prospectus and Schedule Now Available! We're excited to unveil the features planned for Heartland 2025, including industry-leading education and unlimited networking opportunities. We're Not Gonna Take It Anymore thumbnail We're Not Gonna Take It Anymore What choices do we have as an industry tied to insurance contracts and CMS requirements for maintaining billing privileges? Heartland 2025: e-Prospectus and Schedule Now Available! thumbnail Heartland 2025: e-Prospectus and Schedule Now Available! We're excited to unveil the features planned for Heartland 2025, including industry-leading education and unlimited networking opportunities. Forecasting Insights for 2025: A Promise for True Transformation thumbnail Forecasting Insights for 2025: A Promise for True Transformation From technological advancements to evolving patient needs and wants, the landscape in the next 24 to 36 months continues to shift in ways that promise both challenges and opportunities. Forecasting Insights for 2025: A Promise for True Transformation thumbnail Forecasting Insights for 2025: A Promise for True Transformation From technological advancements to evolving patient needs and wants, the landscape in the next 24 to 36 months continues to shift in ways that promise both challenges and opportunities.