New Round of PPP Loans

On January 6, 2021 the SBA rolled out a Second Draw Paycheck Protection Program (PPP) for eligible borrowers who previously received a PPP loan. Second Draw PPP Loans are generally subject to the same terms and conditions as First Draw PPP Loans and can be used to help subsidize payroll costs, rent and utilities, and other business operation expenses related to COVID-19. To increase access for small employers, the SBA plans to set aside around $25 billion for eligible borrowers with a maximum of 10 employees or $250,000 in loans.



In order to qualify for the Second Draw PPP loan, borrowers must use the full amount of their initial PPP loan before the second draw is set to disburse. They must also demonstrate a 25% reduction in gross receipts during any quarter in 2020 as compared to the same quarter in 2019. Additionally, the borrower must employ no more than 300 people, as opposed to the First Draw PPP’s maximum of 500 employees. 


Key Points

  • The last day to apply for a Second Draw PPP loan is March 31, 2021
  • For most borrowers, the maximum Second Draw PPP Loan size is 2.5x average monthly 2019/20 payroll costs with a cap of $2 million 
  • If in any quarter during 2020 shows greater than a 25% loss compared to 2019 and your loan is under $150,000, the loan will most likely be forgiven


Due to the gap between submission of a PPP loan application and the disbursement date, applicants are highly encouraged to submit their applications well in advance of the March 31, 2021 deadline. Visit for more information and details, including the comprehensive program rules. BMPG can help with any other questions you may have.