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New bill would aim to help small firms that have already used up their PPP loans

Written by Jasir Jawaid

Three U.S. senators plan to introduce a bill that would authorize new lending under the Paycheck Protection Program to small businesses with 100 employees or less, including sole proprietorships and self-employed individuals.

In order to qualify, businesses must have already expended an initial PPP loan or be on pace to exhaust the funding, and they must demonstrate a revenue loss of 50% or more due to the COVID-19 pandemic, according to Senate Committee on Small Business & Entrepreneurship Ranking Member Ben Cardin, D-Md., Sen. Chris Coons, D-Del., and Sen. Jeanne Shaheen, D-N.H., who plan to introduce the legislation.

The Prioritized Paycheck Protection Program Act would reserve the lesser of $25 billion or 20% of PPP funds for employers with 10 or fewer employees, as well as small businesses in underserved and rural communities. Publicly traded companies would not be eligible for the loans, and hospitality and lodging businesses with multiple locations would be limited to an aggregate loan amount of $2 million.

The bill would also provide eligible small businesses with as much as 250% of monthly payroll costs worth up to $2 million and allow recipients to apply for loan forgiveness eight weeks after the loans have been disbursed.

This article was published by S&P Global Market Intelligence on the S&P Capital IQ Pro platform.


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