We have heard from many of you with questions on the re-authorization of the Paycheck Protection Program (PPP). The newly authorized program provides for certain businesses to receive a second draw PPP loan and allows businesses who never received a PPP loan to apply. The SBA and the Treasury Department do not expect funds to run out, like in the original PPP program, so there should not be a fear of missing out with this round.
Below is information regarding the second-round process and requirements:
- All current Meadows Bank PPP borrowers that are being invited to apply for a second draw PPP loan should have received an email with a registration link. If you don’t qualify (see qualifications below) or don’t want the loan, you do not need to register.
- New customers, who have a full relationship with Meadows Bank, looking for a first or second round PPP loan should contact their appropriate officer for an invite.
- The SBA’s new system of approval will be checking the application information against Secretary of State (SOS) filings - business names, date incorporated and officer names - any discrepancies may result in the application being kicked out and delay approval – there will not be instantaneous approval like in the first round. Please make sure your filings are up to date and accurate with SOS so as not to cause a delay in approval.
- If you plan to apply for a second draw PPP loan, in order to be eligible, you must be able to show a 25% reduction in gross receipts in any 2020 quarter when compared to the same quarter in 2019. This reduction includes the gross receipts of any affiliates for the same quarters being compared. Therefore, we suggest that you prepare your quarterly financial statements for the borrower and all affiliates, so it is all ready to upload to the portal. For second draw PPP loans, eligibility changed slightly - businesses can only have a maximum of 300 employees (down from 500) and the maximum loan amount is $2,000,000 per business (down from $10,000,000). These provisions will ensure the hardest hit small businesses are receiving the aid.
If you have any further questions on this second round of PPP loan funding, please contact your Meadows Bank loan officer.