By Justin Sink and Mario Parker
WASHINGTON – President Joe Biden on Tuesday signed a law extending the period in which small businesses must apply for forgivable loans to help offset the costs of the coronavirus pandemic, hailing it as a “bipartisan achievement.”
Biden, in a brief ceremony at the Oval Office, said he was proud to sign the legislation, saying that without it people would lose their jobs.
The legislation will extend the paycheck protection program deadline to May 31 from March 31, giving businesses two more months to apply. The law also gives the Small Business Administration an additional 30 days to process loans, in an effort to reduce longer wait times after the government begins to filter applications more strictly to avoid fraud. .
The program – first created under the Trump administration – provides small businesses with no-fee loans guaranteed by the federal government. Payroll, rent, and operating expenses can be waived, meaning many of the loans will be converted into federal government grants.
The SBA says it has approved more than 8.7 million loans valued at over $ 734 billion. Some $ 194.5 billion has already been forgiven by the government, according to agency data.
Earlier this year, the Biden administration announced changes to the program – including an exclusive two-week application window for companies with less than 20 employees and a new calculation formula for sole proprietors. The White House said the changes would help those who struggled to get loans during the early days of the program.