{"id":2745,"date":"2020-06-17T16:00:43","date_gmt":"2020-06-17T21:00:43","guid":{"rendered":"https:\/\/www.headwaycapital.com\/blog\/?p=2745"},"modified":"2020-10-05T15:27:42","modified_gmt":"2020-10-05T20:27:42","slug":"what-does-ppp-flexibility-act-offer-small-business","status":"publish","type":"post","link":"https:\/\/www.headwaycapital.com\/blog\/what-does-ppp-flexibility-act-offer-small-business\/","title":{"rendered":"What Does the PPP Flexibility Act Offer Small Business Owners?"},"content":{"rendered":"

The first round of the <\/span>Payment Protection Program<\/span><\/a> (PPP), executed as part of the <\/span>CARES Act<\/span><\/a> on March 27th, set aside $349 billion to help small businesses impacted by the coronavirus. While the CARES Act provided temporary relief for small business owners in need, those who received funds in April are coming up at the end of their eight-week period. To be eligible for forgiveness, proceeds must be spent on forgivable expenses within 8 weeks of when loan was issued. Restaurant owners and other entrepreneurs located in areas with a limited quarantined customer base exhaust their funding before they can even reopen their doors. Those who are able to reopen are battling low or limited sales, and while the funding helps, it doesn\u2019t mean it\u2019s \u201cbusiness as usual\u201d for many small business owners.\u00a0<\/span><\/p>\n

In response to these concerns, President Trump signed into law the Paycheck Protection Program Flexibility Act (PPP Flexibility Act), which provides greater flexibility for both existing and new borrowers under the PPP. Let\u2019s explore the fundamental aspects of this expansion and how your small business may benefit.<\/span><\/p>\n

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What Is the PPP?<\/b><\/h2>\n

The original version of the PPP offered loans that came with a rate of just 1% and carried a term of two years. PPP loans are 100% backed by the government, but funded through SBA-approved lenders, including banks, credit unions and online lenders.<\/span><\/p>\n

The PPP was intended to guarantee businesses the loans they need to cover approximately eight weeks of payroll. For more on the original PPP, visit the <\/span>U.S. Small Business Administration<\/span><\/a>.<\/span><\/p>\n

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What Changed With the PPP Flexibility Act?<\/b><\/h2>\n

As the country prepared for a phased reopening, it became clear that the initial relief efforts didn\u2019t capture all that was needed to support the needs of small businesses and more aid was necessary. The PPP Flexibility Act, signed into law on June 5, 2020, is aimed at addressing those needs by broadening the original program. Here are some of the key changes:\u00a0<\/span><\/p>\n

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Relaxed Spending Requirements<\/b><\/h4>\n