What Is the $10,000 SBA EIDL Grant?

By Heather Bant on May 5, 2020

Editor’s note: The EIDL program is currently closed and is not accepting new applications (unless you are in the agriculture business). However, we encourage you to apply for the Paycheck Protection Program.



You may have heard about the up to $10,000 advance the SBA is now offering as part of their new application process for the Economic Injury Disaster Loan (EIDL). There have not been a lot of concrete facts released about this program, and as a result, there are a lot of misconceptions swirling around. We’re here to help you make sense of what this means for you and your business.

What is the grant?

An additional $10 billion was allotted through the CARES Act to pay SBA EIDL applicants an advance on their loans. With best guesses for the SBA processing time ranging from 90 days to several months, this is evidently a response to how slowly the SBA has been able to process these applications. This injection aims to help small businesses bridge the critical time spent waiting for a final decision on their loan.

How much will I get?

This is not a flat $10,000 grant to all applicants. $10,000 is simply the maximum you could possibly receive. Currently, the SBA is providing $1,000 per employee, up to ten employees (and if you’re a sole proprietor, you’re eligible for $1,000 only).

How do I get the grant?

It’s as simple as ticking a box in your application. This grant is not included by default, and must be officially requested. On the current SBA applications, this is very easy—just check the box indicating that you would like to be considered for the up to $10,000 advance, and then fill in your banking information for a direct deposit.

If you filled out the old application (without the option for opting in to the grant), you will need to reapply using the new system. The SBA has been saying you won’t lose your initial place in the queue, and 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.

If you filled out the old application involving pdf forms, this amount should be deposited within days of speaking to a loan officer about your application.

This, unfortunately, brings us right back to the unpredictability of the SBA’s processing times. We simply don’t know how long it will take the SBA to actually process these requests and deposit the funds. It’s important to remember that the SBA has never opened their applications to all 50 states and territories at the same time before, 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 you are given through this program does not need to be repaid, even if your application is ultimately rejected. There will be no interest charged on this amount. We believe that the SBA is referring to this as an advance because it will be subtracted from the total loan amount you are issued. Keep in mind that your final loan will, of course, require repayment.

Is the grant given to everyone who applies?

The short answer is yes. We have no reason to believe that any business eligible to apply for a disaster loan can be disqualified from this funding. If you are eligible for the SBA EIDL, you are eligible for this grant.

With that said, keep in mind that the funds assigned to this 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—unless the government releases more funding.

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This post is to be used for informational purposes only and does not constitute legal, business, or tax advice. Each person should consult his or her own attorney, business advisor, or tax advisor with respect to matters referenced in this post. Bench assumes no liability for actions taken in reliance upon the information contained herein.

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