SBA Ups the Limit on COVID-19 EIDL Loans

Restaurants can now apply for up to $2 million to help with pandemic recovery.

Restaurants and other small businesses now have access to more lowinterest federal loan funds to help with pandemic recovery, thanks to a revamped Economic Injury Disaster Loan (EIDL) program.

The U.S. Small Business Administration retooled the EIDL program this month, quadrupling the cap on individual loans from $500,000 to $2 million and offering more flexibility in the way businesses can use the funds. A National Restaurant Association webinar, available to watch on demand, details the changes and provides step-by-step instructions on how to apply.

EIDL is “an important tool in the recovery toolbox for this industry,” notes the Association’s Executive Vice President of Public Affairs Sean Kennedy in the webinar’s opening remarks. That tool just became more powerful.

Businesses that received a previous EIDL loan can request additional funds. The 3.75% business loans are payable over 30 years. “This is very cheap debt that’s stretched over a long time,” says webinar speaker Patrick Kelley, associate administrator of the SBA’s Office of Capital Access.

SBA is authorized to make COVID-19 EIDL loans through Dec. 31, 2021, or when funds are exhausted, whichever occurs first. Restaurateurs are encouraged to apply as soon as possible. Until Oct. 8, the program is limiting loan approvals to $500,000. If you’re requesting that amount or less, apply quicky to take advantage of this exclusivity period. Loans above $500,000 will not be approved before Oct. 8, but you can still apply today.

One tip for those who haven’t received an EIDL loan already: Apply now for up to $500,000, Kelley recommends. As soon as that’s approved—within about three weeks—you can log into the SBA portal and submit a loan modification requesting additional funds.

The revamped EIDL program offers several upgrades including: increased loan amounts; expanded use of funds; deferment of payback; broadened eligibility rules for affiliated businesses; and restrictions on receiving EIDL funds.

How to Apply:

• First time applicants may complete an online COVID-19 EIDL application at SBA.gov/funding-programs/loans/covid-19-relief-options

• Businesses applying for an increase may complete a request in your COVID-19 EIDL portal