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What You Need to Know to Understand About the Payment Protection Program

The purpose of this article is to answer certain frequently asked questions regarding the Paycheck Protection Program—the federal program that makes available $349 billion of forgivable loans to certain small businesses and entrepreneurs—and the corresponding loan forgiveness program enacted as part of the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) as further clarified by the Small Business Administration’s recent guidance.

$10 Billion Increase in Available Disaster Relief Loans

In addition to the $349 billion Paycheck Protection Program (the “PPP”), the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) made $10 billion available to fund disaster relief loans and emergency grants under the Small Business Administration’s existing 7(b)(2) loan program (an “SBA 7(b)(2) loan”) and amended certain rules that apply to 7(b)(2) loans.