Good news for companies that have taken out Covid Economic Injury Disaster (EIDL) loans: The Small Business Administration is extending the grace period for disaster loans again.
With no further Covid-related emergency funds from Congress in sight, the SBA is allowing those seeking emergency loans from the Covid utility to extend the deferral period by 30 months from when the loan was first approved. Those who wish this deferment will still have to pay interest – about 3 percent – on the loans, which are generally considered cheap.
The extension applies to all EIDL loans approved since 2020. Some disaster loans previously had grace periods of 18 months or 24 months.
SBA administrator Isabel Guzman said in a statement Tuesday that the extended loan extension will help millions of small business owners.
The announcement comes just days after a group of 16 senators asked the SBA to extend the suspension period. In their letter, the senators highlighted the challenges small businesses face during the wave of the Omicron variant, including staff shortages and revenue declines. Those same challenges remain for many companies today.
Senator Ben Cardin (D-MD), chairman of the Senate Small Business and Entrepreneurship Committee, praised the SBA’s decision to extend the deferral period. “Washington cannot take our signs of recovery as evidence that small businesses have recovered from the pandemic,” Cardin said in a statement. “Millions of small businesses, especially restaurants, bars and other hard-hit sectors, are wedged between bill delinquencies and rising supply and labor costs.
The EIDL program has provided more than $351 billion in aid to nearly 4 million borrowers, according to the SBA. The SBA did not immediately respond to Inc.’s request. to comment.
This post SBA extends deferral period for disaster loan program
was original published at “https://www.inc.com/melissa-angell/sba-eidl-loans-deferred-payment-covid-relief-congress.html”
