Generally, businesses, 501(c)(3) non-profits, 501(c)(19) veteran’s organizations, and Tribal business concerns with not more than 500 employees (and in certain instances a larger number of employees), as well as sole-proprietors, independent contractors and other self-employed individuals are eligible.

What are the underwriting criteria for EIDL loans?

The SBA can approve and offer EIDL loans based solely on an applicant’s credit score or use an appropriate alternative method for determining applicant’s ability to repay.

2. What are the key program details?

Eligible enterprises may obtain a loan of up to $10 million. The loan amount is calculated by reference to payroll costs incurred by the business and roughly equal to 2.5 times the company’s average monthly payroll costs.

What can it be used for?

Loan proceeds may only be used to support payroll (not including compensation above $100,000 in wages), such as employee salaries, paid sick or medical leave, insurance premiums, and mortgage, rent, and utility payments.

Interest Rates

The interest rate is 3.75% for small businesses.

Additional Details

No collateral or personal guarantees are required, loan payments are deferred for at least 6 months (and not more than one year), there is no prepayment fee, and all fees are waived.

Q: Do I have to pay it back?

A: Yes and No

Most notably, loans made under this program are eligible for loan forgiveness.  The borrower must apply for forgiveness with its lender directly.  The amount forgiven is based upon a formula, taking into consideration—for example—employee retention and amounts spent by the borrower on eligible payroll costs, mortgage interest payments, rent payments and utility payments during a specific period of time.


Any amounts forgiven are not taxable to the borrower as gross income. Any loan amounts not forgiven at the end of one year must be paid by the borrower over a period of up to 10 years at a maximum interest rate of 4 percent.