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The Small Business Administration will also have an additional 30 days to process loan applications.

Senate passes PPP loan extension of two months through May 31; bill heads to President Biden’s desk

Biden will have to sign the PPP Extension Act of 2021 into law before the March 31 deadline

The U.S. Senate passed the PPP Extension Act of 2021 by an overwhelming bipartisan margin on Thursday, extending the Paycheck Protection Program loan deadline by two months from March 31 to May 31. The bill — which now gives the Small Business Administration an additional 30 days to process loan applications — headed to President Biden’s desk, who is expected to sign it into law by the original March 31 deadline.

The vote comes about a week after the U.S. House of Representatives first passed the PPP Extension Act of 2021 before it was passed on to the Senate. The bill, which is designed to help small businesses that are still struggling at this point in the pandemic, has wide bipartisan support. According to CNBC, as of March 21, the SBA has thus far awarded more than 3.1 million loans for a total of $196 billion.

The PPP extension has also received preliminary support from the White House, which introduced changes to the program to better support mom and pop businesses in February, one month after the Paycheck Protection Program reopened on Jan. 11 to new borrowers and select existing PPP borrowers.

Biden announced on Feb. 22 that starting Feb. 24 for a two-week period, only businesses with fewer than 20 employees would be able to apply for PPP loans. He also had tweaked the “loan calculation formula” to help sole proprietors, independent contractors, and self-employed business owners receive more support; set aside $1 billion for businesses without employees in low and moderate-income areas; and lifted some restrictions that made it difficult for immigrants and former felons to apply for loans.

Earlier this month, the SBA also announced an extension of deferment periods for all disaster loans, including the COVID-19 Economic Injury Disaster Loan (EIDL) program, until 2022. All EIDLs issued in 2020 will have their first payment due date extended from 12 months to 24 months from the issued date. All EIDLs issued in 2021, will have their first payment due date extended from 12 months to 18 months after the issued date.

In addition to the PPP loans, restaurant operators will soon be able to apply for Restaurant Revitalization Fund grants through the SBA starting sometime in April, though an exact date has not yet been set.

Contact Joanna at [email protected]

Find her on Twitter: @JoannaFantozzi

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