Paycheck Protection Program (PPP)

US Govt. has started a Payroll Protection Program under the CARES act. Any business having up to 500 employees or less would be eligible to get funding as a loan from SBA equivalent to 2.5 times the monthly payroll of a small business. This funding is for the payroll protection of employees for 8 weeks. The loan will be forgiven if it is used for keeping the employee’s jobs and other expenses such as rents, mortgages, utilities, telephone, and internet. However, the total expenses besides the payroll cannot be more than 25% of the total funds. The program has started on 4/3/2020. A business will have to work with a bank approved by SBA. The purpose of the PPP program is to avoid massive layoffs of employees from small businesses all over the country. Due to coronavirus spread, most of the state governors have shut down non-essential businesses. All domestic and international travels have been canceled. Travel, Hotel-Motel, and restaurant businesses have been impacted the most and almost have no business. If the Govt. doesn’t provide such an aid like PPP, most of the small businesses will have to file bankruptcy.