WASHINGTON, D.C. — The Small Business Administration (SBA) has announced it will triple the maximum loan amount small businesses can access for COVID-19 Economic Injury Disaster Loans (EIDL) starting tomorrow, April 6. The move comes after urging from Senator John Hickenlooper. The Trump administration had arbitrarily set the previous cap far below the $2 million maximum allowed under program rules, and Hickenlooper earlier this month pressed the new administration to allow small businesses to borrow up to the program’s full potential.
The new cap will allow small businesses to receive loans of up to $500,000 and cover up to 24 months of economic injury. Previously, the SBA cap for COVID-19- EIDL loans was limited to six months of economic injury with a maximum loan amount of $150,000.
“I’m pleased the SBA has heeded our call to raise the cap on the size of Economic Injury Disaster Loans, which was unnecessarily hampering thousands of small businesses that needed loans larger than what was allowed,” said Hickenlooper. “While this is a welcome development, the SBA should raise the limit even more – to $2 million loans – which is what current law dictates.”
Additionally, the SBA announced it will reach out directly to small businesses that received a loan under the previous, lower cap with instructions to request an increase on their loan. New loans will automatically be considered under the new, higher cap.
Hickenlooper, a former small business owner himself, sits on the U.S. Senate Committee on Small Business and Entrepreneurship which oversees the SBA.