Don’t Be Caught Off Guard: Your EIDL Is Accruing Interest

You got a COVID-19 Economic Injury Disaster Loan in 2020 or 2021. That’s great! But don’t let the terms of the loan sneak up on you.

The EIDL, offered by the U.S. Small Business Administration, can be a real benefit in helping your business through tough times. While the terms of the loan are favorable for business owners, the government is still charging interest daily on the full loan amount, which can range up to half a million dollars.

Don’t confuse the COVID-19 EIDL with the EIDL Advance. That grant of up to $10,000 is treated differently and does not have to be repaid.

You may have heard that SBA payments on disaster loans have been deferred, and that’s true. But your EIDL is still accruing interest during the deferment period.

Determine your COVID-19 EIDL interest rate

COVID-19 EIDL terms include these fixed interest rates over a 30-year period:

• 3.75% APR for businesses.

• 2.75% APR for nonprofits.

Even with a low interest rate, the loan interest can stack up quickly.

Keep up with your loan balance

You may not be receiving monthly statements from the SBA because of the disaster loan deferrals. Be proactive! 

Stay on top of your EIDL balance yourself by:

1. Logging in to the Capital Access Financial System to view your SBA loan balance and due date.

2. Doing the math on interest accruals to determine whether it makes sense for your business to begin paying off the EIDL ahead of the due date.

3. Completing the 1201 Borrower Form at Pay.gov when you’re ready to pay off your EIDL.

Depending on your individual situation, you may want to skip the deferment and begin paying off your EIDL now. The Certum Solutions team can help you determine the repayment route that’s right for your business.