Highlights of PPP2 - Who can get it and how to use it

PPP round 2 or “PPP2” is here. Some things are the same but there is a lot that has changed. The basic purpose of the PPP program is the same, to help businesses stay in business and cover payroll costs. 

Who can get PPP2 money

Who is eligible?

  1. You were in business as of February 15, 2020

  2. You had a revenue reduction of at least 25% in 2020 compared to 2019. This could be comparing 1 quarter in 2020 to the same quarter in 2019 or the entire year's revenue. 

  3. Can’t be a company organized in China

  4. No more than 300 employees

  5. If you got a PPP loan already it needs to be used by the time you get money for PPP2

Key Points

  1. PPP2 is 100% forgivable if you use it for approved purposes

  2. Unforgiven PPP2 will be a 1% loan for 5 years

  3. Loan calculator is 2.5 x your average monthly payroll or 3.5 if your NAICS code starts with 72 (hospitality industry)

  4. Max loan amount it $2million

  5. You can use the money for a minimum of 8 weeks and a maximum of 24 weeks

How can you use the money?

  1. At least 60% needs to be used for payroll

  2. Rent / mortgage interest

  3. Utilities

  4. Covered property damage from 2020 riots

  5. Worker PPE - masks etc

  6. Business operations - software and cloud hosting

How to get a PPP2 loan

25% Revenue reduction

This is a tricky point and we don’t have full clarity on. Here is what we do know straight from the SBA documents. 

“The borrower must have experienced a revenue reduction of 25% or greater in 2020 relative to 2019. A borrower must calculate this revenue reduction by comparing the borrower’s quarterly gross receipts for one quarter in 2020 with the borrower’s gross receipts for the corresponding quarter of 2019.”

If you are applying for a loan less than $150,000 you do not need to prove the revenue reduction when you apply but you will need to prove it when you apply for forgiveness. To prove this you may need to supply any or all of the following: tax returns, internal financial statements, and bank statements.

Here are the PPP guidelines we have now.


If you received a PPP loan already, it would be best to go back to the same lender and apply for PPP2. Since big banks gobbled up all the money in round 1, smaller banks are allowed to accept applications first. Applications close the end of March, so apply soon if you are eligible.


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