Here’s how the latest stimulus plan aims to help small businesses; SBA announces deferments for EIDL, disaster loans

The latest COVID-19-related stimulus plan, the American Rescue Plan Act of 2021, aims to provide relief for the nation’s small businesses and hard-hit industries for programs the SBA is currently administering.

According to the SBA, the plan adds new efforts to help small businesses, including:

$7.25 billion additional for the Paycheck Protection Program, including to expand eligibility to additional nonprofits and digital news services;
additional funds for the Shuttered Venue Operators Grant program, and now allows businesses to apply for both a PPP loan after Dec. 27, 2020, and the SVOG;
$15 billion additional for Targeted Economic Injury Disaster Loan Advance payments, including $5 billion for Supplemental Targeted EIDL Advance payments for those hardest hit;
$28.6 billion for the Restaurant Revitalization Fund for industry-focused grants; and
$100 million to establish a Community Navigator pilot program, of which grants will go to eligible organizations supporting efforts to improve access to COVID–19 pandemic assistance programs and resources.

EIDL and disaster loans

The SBA also announced extended deferment periods for all disaster loans, including the COVID-19 Economic Injury Disaster Loan program until 2022:

All SBA disaster loans made in calendar year 2020, including COVID-19 EIDL, will have a first payment due date extended from 12-months to 24-months from the date of the note.

All SBA disaster loans made in calendar year 2021, including COVID-19 EIDL, will have a first payment due date extended from 12-months to 18-months from the date of the note.

Existing SBA disaster loans approved prior to 2020 in regular servicing status as of March 1, 2020, received an automatic deferment of principal and interest payments through Dec. 31, 2020, according to the SBA.

The initial deferment period was subsequently extended through March 31, 2021, while an additional 12-month deferment of principal and interest payments will be automatically granted to these borrowers. Borrowers will resume their regular payment schedule with the payment immediately preceding March 31, 2022, unless the borrower voluntarily continues to make payments while on deferment, according to the SBA.