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Comparing PPP to EIDL

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A comparison of the Paycheck Protection (PPP) and the Economic Injury Disaster Loan (EIDL) Programs reveals the benefits and shortcomings of both. 

 

 

 

Subject PPP Loan Program EIDL Loan Program
Who Administers?
SBA Approved Lenders
SBA
Loan Term, Maturity & Deferral
2 years | Payments start 6 mos. from origination, but interest accrues during 6 mo. deferement period
Up to maximum of 30 years | Payments start 12 mos. from origination, but interest accrues during 12 mo. deferement period
Interest Rate
1%
3.75% (but 2.75% for non-profits)
Prepayment Penalties or Fees
None
None
Permitted Usage of Loan
Payroll and certain benefits, and also interest on mortgage payments or other debts, rents and utilities. Exclusions: compensation in excess of $100k or qualified sick and family leave covered under sections 7001 and 7003 of the Families First Coronavirus Response Act. At this point, SBA’s Interim Final Rule does not define “compensation,” but many financial institutions are interpreting “compensation” to include employer cost of health insurance, retirement benefits, and state and local taxes.
5c Payroll and certain benefits, and also interest on mortgage payments or other debts, rents and utilities. Exclusions: compensation in excess of $100k or qualified sick and family leave covered under sections 7001 and 7003 of the Families First Coronavirus Response Act. At this point, SBA’s Interim Final Rule does not define “compensation,” but many financial institutions are interpreting “compensation” to include employer cost of health insurance, retirement benefits, and state and local taxes.
Amount of Loan

Loan not to exceed $10 million cap.

Loan consists of 2.5 times average monthly payroll costs (not including independent contractor payments) for a 1-year period.

This 1-year period may be for yr. 2019 or 1-year period before applying (not specified by SBA, and banks are making this decision) incurred during calendar year 2019

Calculations for seasonal and new businesses can vary.

 

Up to $2 million
7a
7b
7c
8a
8b
8c
9a
9b
9c
10a
10b
10c

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