The U.S. Small Business Administration (SBA) has been directed to provide additional deferment of principal and interest payments for existing COVID Economic Injury Disaster Loan (EIDL) program borrowers.
The extended deferment period—30 months deferment from inception on all approved COVID EIDL loans—will provide additional flexibility to small business owners impacted by the pandemic, especially those in hard-hit sectors managing disruption with recent variants, as well as recent supply chain and inflation challenges amid a growing economic recovery.
Since its inception, the COVID EIDL program, a federal disaster relief loan, has allocated more than $351 billion in relief aid to 3.9 million borrowers, including to the smallest of small businesses from historically underserved, disadvantaged communities, according to the SBA.
“Though our small business owners continue to power a historic economic recovery under the Biden-Harris Administration, we must continue to do everything in our power to meet our small businesses where they are with resources to ensure they can recover and thrive,” said SBA Administrator Isabel Guzman. “This extended principal and interest deferment will provide financial relief to millions of small business owners—particularly those hardest-hit by the pandemic and related marketplace challenges – so they can continue to pivot, adapt, and grow.”
The deferment extension is effective for all COVID-EIDL Loans approved in calendar years 2020, 2021, and 2022. Loans now have a total deferment of 30 months from the date of the Note. Interest will continue to accrue on the loans during the deferment.
Borrowers may make partial or full payments during the deferment period but are not required to. The SBA recommends using www.pay.gov.
The SBA will not send monthly SBA Form 1201 payment notices, however it will send regular payment reminders via email.
Existing COVID EIDL Borrowers can find account balances and payment due dates in the SBA Capital Access Financial System (CAFS) and learn how to set up an account in the CAFS system by logging in at Capital Access Financial System (sba.gov).
Officials said the deferments may result in balloon payments. The deferment will not stop any established Pre-authorized Debit (PAD) or recurring payments on the loan. COVID-EIDL Borrowers with an SBA established PAD must contact their SBA servicing center to stop recurring payments during the extended deferment period. COVID-EIDL
After the deferment period ends, COVID-EIDL Borrowers will be required to make regular principal and interest payments beginning 30 months from the date of the note.
“This new action taken by the SBA and Administrator Guzman will give the smallest of small businesses more flexibility in recovering and returning to their pre-COVID strength. By extending the COVID EIDL deferment period, small businesses will be able to use capital obtained through sales to grow their businesses when it matters most,” said SBA Atlantic Regional Administrator Marlene Cintron, who oversees the federal agency’s operations in New York, New Jersey, Puerto Rico and the U.S. Virgin Islands.
Borrowers with questions can call SBA’s COVID EIDL Customer Service Center toll-free at 1-833-853-5638 (borrowers who are deaf, hard of hearing, or have a speech disability can dial 7-1-1 to access telecommunications relay services) or email DisasterCustomerService@sba.gov for additional assistance.
The center is open Monday through Saturday from 8 a.m. to 8 p.m. Multilingual representatives are available. Small business owners may also contact SBA’s Resource Partners by visiting www.sba.gov/local-assistance. For additional information on COVID EIDL, visit www.sba.gov/relief.