3 Things Women-Owned Businesses Should Know About the New PPP

With the revamped Paycheck Protection Program under way, women business owners have a few advantages that can help them access the funds they need. This is especially important because women were approved at lower rates the last time around. 

So what are those advantages and how can you make sure your application is at the top of the pile?

What You Need to Know About PPP Loans for Women-Owned Businesses 

Here’s a quick breakdown of what’s in the new Covid-19 relief package for women-owned small businesses, when you can apply, and how to get started. 

1. There’s money set aside just for you 

Good news! Due to the disparities last time, the SBA set aside money for women business owners and other disadvantaged groups in the second round of PPP funding. 

The set asides primarily focus on allocating resources to certain lenders who are more likely to work with these types of businesses. But there are also funds dedicated to smaller businesses, those with fewer employees, and those who need less money.

Not sure what that means for you? Here’s how it breaks down including lenders you can work with and other resources for you depending on the details of your business.

Lenders to consider

• Community financial institutions: Most community banks or financial institutions serve women- or minority-owned businesses. That’s why $15 billion is available via these lenders. And that applies for first time loan recipients as well as those who are receiving a second loan.
  
  So look for these types of institutions when finding a lender, as you’ll have a better chance of accessing funds.
  
  Find a community financial institution near you

• Insured Depository Institutions, Credit Unions, and Farm Credit System Institutions: There’s also $15 billion available from these lenders for both first and second draw PPP loans, which makes them a great option for applying through. 

First time borrowers

• If you didn’t receive a PPP loan in the first round or didn’t apply, there’s money set aside for you—$35 billion to be exact. 

Businesses with 10 employees or less

• Of that $35 billion, if you have 10 employees or less, $15 billion is available for those who didn’t receive a PPP loan last time and $25 billion available for second draw PPP loans.

Businesses in low or moderate income neighborhoods who wish to borrow less than $250,000

• If you live in a low income area or don’t need a large loan (less than $250,000), that same $15 and $25 billion is available to you as well.

2. You can (and should!) apply early 

The SBA is giving you a head start—they started accepting applications for first-time PPP loans from community financial institutions on January 11th and for second-draw loans on January 13th.

Make sure you reach out to your community bank asap to start the process. Last time, funds ran out early, so you’ll want to move quickly. 

3. Get your materials ready 

The faster you have your materials ready, the faster you can apply. This applies to anyone, whether you applied last time or this is your first go around. 

Here are some helpful resources you can use to get started:

• SBA: Paycheck Protection Program Overview
• PPP First Draw Borrower Application Form
• PPP Second Draw Borrower Application Form
• COVID-19 Relief Package: 8 Ways to Access Funding

Women-Owned Businesses: Apply ASAP

Despite the set-asides for funding, there are a lot of businesses that desperately need this relief—85%, according to our data. So jump on the opportunity as soon as you can.

Have you applied or will you apply for the second round of funding? Do you think the resources for women-owned businesses are enough? Share your thoughts in the comments.