The truth behind popular misconceptions.

$183 billion*. That’s the amount of money still available through the Paycheck Protection Program (PPP).  Only 36% of the original amount allocated has been applied for so far by small businesses who have been financially impacted by the pandemic.  This leaves a lot of money on the table, that will expire on March 31.

If you are a business owner considering a PPP loan, but have doubts if the program is for you, this article should help clear up common misconceptions. 

MYTH #1: The PPP is just for big businesses.

FACT: If you are considering your first PPP loan and have less than 500 employees, you are eligible for a PPP loan. In fact, even if you have no employees, the program may be available to you (see myth #2).

According to the U.S. Small Business Administration (SBA), as of August 2020, 75% of businesses that have received PPP loans have nine or fewer employees. Furthermore, nine out of 10 loans have been for $150,000 or less.

MYTH #2: I can only get the PPP if I have employees.

FACT: If you run a business, even as a sole proprietor or an independent contractor, you may be eligible to apply for a PPP loan. If you don’t have employees, you will have to submit IRS Form 1040 Schedule C to report your net business income. If you were in business on or before February 15, 2020, and your business has filed a 2019 or 2020 tax return (Form 1040 Schedule C for 2019 or 2020 for independent contractors), you can apply.

MYTH #3: My business probably won’t meet the credit and eligibility requirements.

FACT: If your business was in operation on February 15, 2020, you have already met a key eligibility requirement. You will need to provide documentation showing that you were in business and demonstrating payroll.

Small businesses owners may also worry that their credit status could keep them from getting a PPP loan.  Although you will apply through a lender, there is no credit check requirement when applying for a PPP loan. 

MYTH #4: If you get have other SBA financial assistance, you can’t get a PPP loan.

FACT: Business owners can apply for the PPP and other SBA financial assistance (except for the Shuttered Venue Operators Grant), such as the Economic Injury Disaster Loan (EIDL) and Section 7(a) loans. However, you can’t use your PPP funding and your EIDL loan for the same purpose (e.g. payroll). Please note that we are specifically talking about the EIDL loan which must be repaid, not an EIDL advance.

While each program has its own requirements, don’t let the idea of applying for one loan sway you from applying for the other. Now is the time to use all the resources available to you. Just make sure you follow the guidelines of each program and maintain your documentation on how you are using each loan.

MYTH #5: The forgiveness process is complicated and won’t apply to my business.

FACT: First, full forgiveness of your PPP loan is not guaranteed.  However, if you use the PPP loan proceeds as required by the PPP rules your loan should be forgiven.  However, if some or all  your PPP loan cannot be forgiven, the terms of the loan are better than most at 1% APR for 60 months with payments deferred up to 10 months following the end of the chosen covered period. If you apply for forgiveness prior to the end of your deferment, the deferment ends when loan forgiveness is remitted by the SBA or if the loan forgiveness is denied, when the decision is communicated.

The keys to loan forgiveness are understanding the requirements of the program and maintaining the appropriate documentation.


The true fact is the PPP may not be the answer for every business, but it is worth considering. We encourage you to speak with your banker for additional information on SBA programs or consult your attorney, CPA, or other advisor to help determine eligibility.


Additional resources

You can go to to learn more about eligibility and how to calculate your PPP loan.

M&T Bank also has a Paycheck Protection Program page with tools and information specifically for business.

*As of February 7, 2021 


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