A sample application for the program, which is administered by the U.S. Small Business Administration (SBA), requires applicants to "agree not to discriminate in any business practice, including employment practices and services to the public" in categories laid out in Title 13 of the Code of Federal Regulations.
Scott Anderson, president and CEO of Zions Bank, said, "The Paycheck Protection Program from the CARES Act reinforces the fact that small businesses are integral to our economies as employers and engines for economic growth".
"There really has never been a product like this in our history, with not only the streamlined nature but the fact that there is very little underwriting required in terms of personal guarantees, no collateral, no requirement for credit elsewhere", said Steve Bulger, regional SBA administrator for the second Mid-Atlantic region.
A total loan pool of $50 million will be quickly dispensed to eligible small businesses across Louisiana.
According to Eric DeGesero from New Jersey-based Edge Consulting, "any business in America with under 500 employees, including independent contractors and sole proprietors, should contact their local bank and apply".
The new loan program will be available retroactive from February 15, so employers can rehire their recently laid-off employees through June 30.
"Under the CARES Act, the president took historic action, making available hundreds of billions of dollars in an expedited manner to provide immediate financial relief for small business owners across the country", Carranza said in a statement.
- While the PPP loans were originally supposed to be available through SBA-approved lenders, the agency is now inviting a wider range of FDIC-insured financial institutions to participate.
- The loans must be paid back within two years, a smaller time frame than originally announced.
Lenders are expected to begin processing loan applications on April 3 with same-day approval. Business must keep their workforce largely intact during that period to qualify for loan forgiveness.
The $349 billion government-guaranteed loan program is a centerpiece of the $2.2 trillion US coronavirus rescue package. Maine Community Bank in Biddeford, Maine, has fielded inquiries about the loan program from more than 300 small businesses.
Industry experts predict a "feeding frenzy", CNBC warned on Thursday, painting a nightmarish scenario in which millions of profit-starved businesses overload the application website clamoring for the "first come, first served" loans as soon as its (virtual) doors open - creating an Obamacare-esque debacle that could snarl distribution of the aid for months.
"What we heard initially some two weeks ago, was, 'I don't need another loan, I need cash today, '" Arveschoug said.
Neither the government nor lenders will charge small businesses any fees. That may not be enough to meet demand, but it is possible Congress will decide to put more funds toward this program. Small businesses must apply for the loans directly with the SBA. Second, although the term "payment of any retirement benefit" seems broad, it appears that it is meant to be limited to payments made by an employer as part of its normal payroll costs. "To think a business can get through this Payment Protection Program a forgivable loan up to $10 million ... obviously has never happened before and likely will never happen again".
"We are in uncharted territory and I want to make sure people understand what is available so they can access the programs they need to make it through this situation".
The information will be used to support a request for Economic Injury Disaster Loan declarations from the SBA.
This is a loan that can turn into a grant if the business is able to retain its employees.