SBA Paycheck Protection Program
Meridian Trust Federal Credit Union stands ready to provide our members and communities with all of the available help and support that we can in these challenging times. That's why we're excited to be a participating lender in the Paycheck Protection Program. This program is intended to help small businesses retain their employees during this time. Your business may be eligible for a loan; however, funds are limited and subject to availability by the Small Business Administration (SBA). Meridian Trust is currently accepting loan applications from our existing members.
What is the Payroll Protection Program?
It is a loan designed to provide a direct incentive for small businesses to keep their workers on the payroll. SBA will forgive loans if all employees are kept on the payroll for eight weeks and the money is used for payroll, rent, mortgage interest, or utilities. The Paycheck Protection Program will be available through June 30, 2020 or until funds run out.
The loan will be fully forgiven if the funds are used for payroll costs, interest on mortgages, rent, and utilities (due to likely high subscription, at least 75% of the forgiven amount must have been used for payroll). Loan payments will also be deferred for six months. No collateral or personal guarantees are required. Neither the government nor lenders will charge small businesses any fees. This loan has a maturity of 2 years and an interest rate of 1%.
Forgiveness is based on the employer maintaining or quickly rehiring employees and maintaining salary levels. Forgiveness will be reduced if full-time headcount declines, or if salaries and wages decrease.
Which businesses are eligible?
This program is for any small business with less than 500 employees (including sole proprietorships, independent contractors and self-employed persons), private non-profit organization or 501(c)(19) veterans organizations affected by coronavirus/COVID-19. Small businesses in the hospitality and food industry with more than one location could also be eligible if their individual locations employ less than 500 workers.
What do businesses do to apply?
Businesses must submit an application. This is then submitted by the participating lender who will fund the loan once approval is obtained from the SBA.
The SBA is routinely updating the details about this program. For more information on eligibility, funding, other assistance and more, please visit their website.