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First Draw SBA Paycheck Protection Program (PPP)

Eligible businesses that did not receive a PPP loan previously may be able to apply for a First Draw PPP.


Who Can Apply

Eligible small entities that did not receive a PPP loan previously can apply if together with their affiliates (if applicable) they have 500 or fewer employees, including nonprofits, veterans organizations, tribal concerns, self-employed individuals, sole proprietorships, and independent contractors. Entities with more than 500 employees in certain industries that meet SBA’s alternative size standard or SBA’s size standards for those particular industries can also apply. Also eligible to apply for First Draw PPP Loans are businesses with a NAICS Code that begins with 72 (Accommodation and Food Services sector) or eligible news organizations with no more than 500 employees per physical location, as well as housing cooperatives, 501(c)(6) organizations, or destination marketing organizations with no more than 300 employees. 

Loan Terms

  • Loan amount is equal to 2.5x average monthly payroll for 2019 or 2020.
  • 1% interest rate.
  • Loans issued prior to June 5, 2020, have a maturity of two years. Loans issued after June 5, 2020, have a maturity of five years.
  • Loan payments will be deferred for borrowers who apply for loan forgiveness until SBA remits the borrower's loan forgiveness amount to the lender. If a borrower does not apply for loan forgiveness, payments are deferred 10 months after the end of the covered period for the borrower’s loan forgiveness (either 8 weeks or 24 weeks).
  • No collateral requirements and no personal guarantee.

Use of Funds

First Draw PPP Loans can be used to help fund payroll costs, including benefits. Funds can also be used to pay for mortgage interest, rent, utilities, worker protection costs related to COVID-19, uninsured property damage costs caused by looting or vandalism during 2020, and certain supplier costs and expenses for operations.


Full Forgiveness Terms

First Draw PPP Loans made to eligible borrowers may qualify for full loan forgiveness if during the 8- to 24-week covered period following loan disbursement:

  • Employee and compensation levels were maintained;
  • the loan proceeds were spent on payroll costs and other eligible expenses; and
  • at least 60 percent of the proceeds were spent on payroll costs.

IRS Form 1040, Schedule C

Effective March 3, 2021, the SBA allows individuals who file an IRS Form 1040, Schedule C, the option to calculate their maximum loan amount using net profit or gross income (a borrower whose PPP loan has already been approved cannot increase its loan amount based on the new calculation method).

When and How to Apply

As of May 4, 2021, the SBA has announced that all authorized funds for the Paycheck Protection Program have been exhausted. At this time, we are no longer accepting applications.

For more PPP loan information visit

Please contact your St. Mary’s Bank Commercial Banking representative at, or call (603) 629-1692 with questions.