March 31, 2020
The NPA’s Team GRC received additional information today about the CARES Act that the SBA may make the new Paycheck Protection Program (“PPP”) loans available to pawnbrokers. We are only providing new information we have and it is subject to SBA guidance, which we are told not to expect any earlier than Friday, April 3rd.
This information suggests that pawnbrokers may be eligible for PPP loans if 50% of their “revenues” or “gross revenues” (depending on which term they apply) for the previous year came from the sale of merchandise rather than from the interest/service charges collected on pawn loan transactions.
We are still waiting for information on other eligibility criteria. But we do understand that the PPP applications will go to currently authorized SBA section 7(a) lenders and that the SBA will not be involved in eligibility decisions. We will watch for any new guidance from SBA and keep members posted as soon as possible. We are working now to get more information on the PPP application and eligibility requirements.
Current information is that the SBA plans to issue further guidance no sooner than Friday, April 3, 2020. We are following these issues as closely as possible and will update the information as promptly as we can.
This document is intended only as a summary of the CARES Act provisions described
and does not constitute legal advice.
Please consult your local lawyer for more information.
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