Economic Injury Disaster Loan

Who Is Eligible for Economic Injury Disaster Loans?

Economic Injury Disaster Loans (EIDL) are provided by the U.S. Small Business Administration (SBA) to support small businesses and private non-profit organizations that are suffering substantial economic injury due to a declared disaster. Here are the eligibility criteria:

  1. Business Size: Small businesses, small agricultural cooperatives, small aquaculture businesses, and most private non-profit organizations. 
  2. Location: Businesses must be located in a declared disaster area. 
  3. Economic Injury: The business must have suffered substantial economic injury, meaning it is unable to meet its obligations and pay its ordinary and necessary operating expenses. 
  4. Credit History: Applicants must have a credit history acceptable to the SBA. 
  5. Repayment Ability: Applicants must demonstrate an ability to repay the loan. 
  6. No Duplicate Benefits: Businesses cannot receive disaster assistance from another source for the same loss.

What Are the Loan Terms for Economic Injury Disaster Loans?

The EIDL offers favorable terms to help businesses recover from disaster impacts:

  1. Loan Amount: Up to $2 million, based on the economic injury suffered and the business’s financial needs.
  2. Interest Rates: Fixed interest rates, typically at 3.75% for small businesses and 2.75% for non-profit organizations
  3. Repayment Terms: Up to 30 years, with repayment terms determined on a case-by-case basis based on the borrower’s ability to repay.
  4. Use of Funds: EIDL funds can be used for working capital and normal operating expenses, such as rent, utilities, fixed debt payments, and payroll.
  5. No Prepayment Penalty: Borrowers can repay the loan early without incurring additional fees.

Key Takeaways

  • Eligibility: Includes small businesses, small agricultural cooperatives, small aquaculture businesses, and most private non-profits in declared disaster areas.
  • Loan Terms: Up to $2 million with fixed interest rates (3.75% for businesses, 2.75% for non-profits), and repayment terms up to 30 years.
  • Purpose: Helps cover working capital and operating expenses during recovery from economic injury caused by a disaster.
  • Advantages: Favorable interest rates, long repayment terms, and flexibility in fund usage without prepayment penalties.

Economic Injury Disaster Loans provide critical financial support to businesses and nonprofits facing significant economic challenges due to disasters, helping them stabilize and continue operations.


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