BATON ROUGE, La. (WVLA/WGMB) — Small businesses struggling amid the coronavirus pandemic can seek loans through a federal program outlined Friday.
The Paycheck Protection Program application period opened hours after the Small Business Administration released interim final guidance, which includes a 1 percent interest rate. Previous guidance set the rate at 0.5 percent.
“The rate change could provide a little comfort to lenders and a little more hope to borrowers,” Baton Rouge Area Chamber senior vice president Liz Smith said in a statement. “It remains to be seen whether area lenders agree that the interest rate bump makes the loans appealing. It’s critical that these loans are attractive to both lenders and borrowers to get these dollars actually paying paychecks.”
The rate change is still significantly lower than the 4% maximum provided for in the CARES Act.
The guidance encourages borrowers to seek the full available amount of the loan of $10 million, as it strictly notes that only one loan per borrower will be allowed. It notes that the PPP is “first-come, first-serve,” underlining BRAC’s earlier urging to small businesses to apply as soon as possible to avoid running up against the funding cap.
- Borrowers can apply for the Paycheck Protection Program here.
- A list of SBA-approved lenders in the Baton Rouge area is available here.
- You can read more about the program here.
BRAC is continuing to review the updated guidance on the PPP, and will make that information available at brac.org/recovery.
Information from the Baton Rouge Area Chamber was used in this article.