The U.S. Small Business Administration (SBA) and the Department of the Treasury announced that they have initiated a mobilization effort of banks and other lending institutions to provide small businesses with the capital they need to address the impact of the COVID-19 pandemic.

The Coronavirus Aid, Relief, and Economic Security (CARES) Act, which was recently passed by Congress and signed into law by the President, establishes a new $349 billion Paycheck Protection Program. The new program will provide loans to help small businesses with their payroll and other business operating expenses.

Under this program, businesses will be able to go to a participating SBA 7(a) lender, bank, or credit union, apply for a loan, and be approved on the same day. Loans will be available without collateral requirements, personal guarantees or SBA fees, with a 100% guarantee from SBA. All loan payments will be deferred for six months.

SBA will forgive the portion of the loan proceeds that are used to cover the first eight weeks of payroll costs, rent, utilities, and mortgage interest. Loans will be available retroactively from February 15, 2020, so that employers can rehire their recently laid-off employees through June 30, 2020.

The program is expected to be up and running by April 3rd. For further details about the program, read the SBA press release here.