SBA Extends Crucial Lifeline to Borrowers Impacted by COVID-19 with Debt Relief

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WASHINGTON – As the U.S. Small Business Administration continues implementation of the Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act, signed into law by President Trump on December 27, 2020, SBA Administrator Jovita Carranza made the following statement in regards to Section 325:

“Small business is big business in America, and this Administration will continue to extend a lifeline to small business owners during this critical time. Congress charged the SBA with making debt relief payments (principal, interest, and fee payments) under Section 1112 of the CARES Act to help borrowers in SBA’s 7(a), 504, and Microloan programs; and now SBA is working expeditiously to implement the newly enacted assistance.

The new law extends SBA debt relief authority, allowing the Administration to continue alleviating adverse economic effects of COVID-19 for small businesses with SBA loans. Since April last year, the SBA has made over $7.1 billion in payments across 1,819,130 loans on behalf of these borrowers. It’s important to note that these firms were also initially able to access capital because of the SBA federal guarantee.”

The SBA is determining how much additional debt relief assistance can be provided to SBA borrowers with the newly issued Congressional appropriation. Debt Relief guidance will soon be posted on the SBA website.

The U.S. Small Business Administration helps power the American dream of business ownership. As the only go-to resource and voice for small businesses backed by the strength of the federal government, the SBA empowers entrepreneurs and small business owners with the resources and support they need to start, grow or expand their businesses, or recover from a declared disaster. It delivers services through an extensive network of SBA field offices and partnerships with public and private organizations. To learn more, visit www.sba.gov.