Overview – The (EIDL) Economic Injury Disaster Loan Grant

Offers up to a $10,000 grant to businesses as an operating advance through the SBA. The SBA is now offering this grant as part of their new EIDL loan application process. There are a lot of misconceptions swirling around the Economic Injury Disaster Loan (EIDL). Rodriguez Albizu P.A., is here to help you make sense of what this means for you and your business.


In addition to the entities that are already eligible for SBA disaster loans (small businesses, private non-profits, and small agriculture cooperatives), eligibility is temporarily expanded to include:

  • Business entities with 500 or fewer employees:
  • Sole proprietor-ships, with or without employees
  • Independent contractors
  • Cooperatives and employee owned businesses
  • Tribal small businesses
  • Private non-profits of any size.

Additionally, you must have been in business as of January 31, 2020.  Expanded eligibility criteria and the emergency grants are only available between January 31, 2020 and December 31, 2020.


The (EIDL) Economic Injury Disaster Loan Grant

What is the grant?

An additional $10 billion has been allotted by Congress through the CARES Act to pay SBA EIDL applicants an advance on their loans. The best estimate for the SBA Loan processing time may take up to 90 days and as much as several months, it’s an estimation as to how slowly the SBA may be able to process the applications of small businesses across the Untied States. A federal subsidy will be a needed cash injection to help small businesses owners buy critical time to keep their doors open while waiting for a final decision on their loan application

How much will I get?

A $10,000 grant is simply the maximum a business owner can possibly be granted to keep their business operating. So far, no information has been distributed as to how this amount will be calculated, there has been no official word from the SBA to date.

How do I get the grant?

Applicants are not considered for the grant by default, the applicant must be officially requested though the loan application. On the current SBA applications, the applicant just has to check the box indicating that they would like to be considered for the advance.

NOTE: The original application did not have an option for opting into the grant. Applicants need to reapply using the new application process. The SBA’s website says that applicants reapplying won’t lose their initial place in the application queue, the second application serves as a request for the grant.

When will I get the grant?

According to the SBA, you’ll receive the grant “within days” of completing your application. For applicants unfortunately the unpredictability of the SBA’s processing times may vary from week to week. They simply don’t state how long it will take the SBA to process the requests and deposit the applicant’s funds. Notably the SBA has never opened their applications to all 50 states at the same time, this is a historical test of the SBA’s infrastructure and this is a completely unprecedented situation.

Do I have to pay it back?

While the SBA refers to this program as an advance, it was written into law as a grant. This means that the amount an applicant is granted through this program does not need to be repaid, even if the application is ultimately rejected. There will be no interest charged on this amount. The SBA is referring to this as an advance because it will be subtracted from the total loan amount to the applicant. It’s important to keep in mind that the final loan will of course, require repayment. A good attorney is key to understanding documentation with complex details such as these.

Is the grant given to everyone who applies?

The short answer according to the SBA is yes. There is no reason to believe that any business eligible to apply for a disaster loan will be disqualified from the federal funding process. If your business is eligible for the SBA EIDL Grant, most likely the business owner or entity is eligible for the grant.

According to the SBA the funds that are assigned to the EIDL Grant program are separate from the funds allocated to the Disaster Loans, and these funds are finite. Once the SBA has depleted their budget, there will be no more advances available.