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EIDL Payment Due? What to Do if You Can’t Pay Back Your Pandemic-Related Loan

What to Do if You Can't Make Your EIDL Payment
Nancy Bilyeau
Nancy BilyeauUpdated February 3, 2023
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Editor’s note: Lantern by SoFi seeks to provide content that is objective, independent and accurate. Writers are separate from our business operation and do not receive direct compensation from advertisers or partners. Read more about our Editorial Guidelines and How We Make Money.
About 4 million businesses that received loans from the Small Business Administration (SBA) to help them through hardship caused by the COVID-19 shutdown are now required to pay back those loans. For some businesses, the first payments for the COVID-19 Economic Injury Disaster Loan (EIDL) were due in the last three months of 2022. Then, more than 1 million of these SBA loans came due beginning in January 2023. But there’s a problem. Some of these businesses, now battling inflation, say they are struggling to make the payments on their SBA Covid loans and are trying to find out if they absolutely must do so. Read on to learn about SBA Loans Forgiveness and what entrepreneurs can do to stay afloat during the ongoing challenges caused by COVID and inflation.

Do You Have to Pay Back Your EIDL Loan?

Yes. “You are responsible for your COVID-19 EIDL monthly payment obligation beginning 30 months from the disbursement date,” says the SBA on its website.In response to the pushback in 2022 from the business community, the SBA offered another short deferment and created a hardship plan that could help some businesses. It’s important to look at the history of the EIDL program and what happened during COVID. The long-standing EIDL program was originally created to assist businesses, renters, and homeowners located in regions affected by declared disasters.During the pandemic, the SBA expanded the program to include businesses negatively impacted by the coronavirus pandemic. Small businesses that qualified for the program could borrow up to $2 million with loan terms of 3.75% fixed interest over 30 years. The SBA said it delivered “an unprecedented level of economic aid to small businesses impacted by the pandemic.” Over 4 million “hard-hit” businesses were approved for nearly $390 billion in Covid loans.  There is no forgiveness for these EIDL loans.

Paycheck Protection Program: Forgiveness Available

The Paycheck Protection Program (PPP), SBA-backed loans that helped businesses keep their workforce employed during the COVID-19 crisis, was separate from EIDL. It ended on May 31, 2021. While there is no SBA Loans Forgiveness, there is forgiveness for PPP.The SBA said about PPP, “Borrowers can apply for forgiveness once all loan proceeds for which the borrower is requesting forgiveness have been used. Borrowers can apply for forgiveness any time up to the maturity date of the loan. If borrowers do not apply for forgiveness within 10 months after the last day of the covered period, then PPP loan payments are no longer deferred, and borrowers will begin making loan payments to their PPP lender.”

Can EIDL Borrowers Get Deferments?

There was a deferment on EIDL payments built into the original loan program.The SBA provided a deferment period of 30 months from the date on the original note on the loan for COVID-19 EIDL borrowers, most of them distributed in 2020 and 2021. (This deferment does not apply to non-COVID disaster home and business loans.) “Interest will continue to accrue on the loans during deferment,” the SBA said.Then, in March 2022, the SBA offered an additional six-month deferment of principal and interest payments to SBA’s existing COVID-19 EIDL borrowers. There have been no further deferments offered since then.Recommended: 7 Ways to Manage Your Covid-19 EIDL Loan Difficulties

Covid Hardship Program for EIDL 

The SBA is offering a Hardship Accommodation Plan for borrowers experiencing short-term financial challenges. Borrowers eligible for this plan may make reduced payments for six months. Interest will continue to accrue, which may increase (or create) a balloon payment due at the end of the loan term.


  • Borrowers are required to pay at least 10% of their monthly payment amount (with a $25 minimum), for six months.  
  • During the Hardship Accommodation period, borrowers can voluntarily make larger payments.
  • The regular monthly payment amount will resume and be required after the six-month Hardship Accommodation period ends. Borrowers may be able to renew the Hardship Accommodation Plan, if necessary.

Eligibility & Enrollment

Borrowers are eligible to enroll in the Hardship Accommodation Plan beginning 60 calendar days before their first payment due date. 
  • If your loan amount is less than or equal to $200,000:  To enroll in the Hardship Accommodation Plan, create a CAFS account or log in to your existing account. Within CAFS, hover over "Borrower" and select "Borrower Search." Select the appropriate loan number and request the Hardship Accommodation on the Loan Info page.
  • If your loan amount exceeds $200,000: To apply, contact the COVID-19 EIDL Servicing Center at 833-853-5638 or [email protected] (and include “Hardship Accommodation Plan” in the subject line). 

Options for Businesses That Need More Help

When some business owners first pursued large loans offered by EIDL, it was hard to foresee the supply chain crisis and soaring inflation. Now, the question is, how to pay an EIDL loan."The issue is many small businesses aren't where they would like to be now that the repayments are coming due," Ruth Simon of the Wall Street Journal told CBS News.The SBA offers free or low-cost counseling for small businesses. These services may be able to help review your business plan, identify opportunities to access capital, or provide information on applicable tax benefits, among other counseling services. Contact your local SBA District Office for assistance.Once they’ve figured out how to pay EIDL loan, some business owners wanting to grow their companies may seek out additional financing. Options range from small business loans to invoice financing and factoringOther entrepreneurs may decide to turn away from loans, business credit lines, and other financing to focus on another path.The areas proving fruitful are aggressively seeking out nonprofit community development institutions for grants and other support and pursuing investors, whether it’s angel investors or donations obtained from crowdsourcing. Women, members of recognized minority groups, veterans, and others are able to qualify for targeted help.Recommended: The Essentials on Small Business Funding and Building Credit

The Takeaway

The low-interest loans from the SBA offering help through the pandemic held great appeal for small businesses. However, paying them back is proving painful for owners who hoped that in 2023 they would be in a stronger position. There is no SBA Disaster Loan Forgiveness. However, there is a hardship program available from the SBA to help business owners. And going forward, there are a range of approaches to growing a business, including small business loans. Lantern by Sofi lets you compare small business loans on one marketplace.

Frequently Asked Questions

Do you have to pay back your EIDL loan?
Are EIDL loans still available from the SBA?
Are PPP loans forgivable?
Photo credit: iStock/baona

About the Author

Nancy Bilyeau

Nancy Bilyeau

Nancy Bilyeau writes about student loans, mortgages, car insurance, medical debt and many other finance topics for Lantern. A veteran of the magazine business, she has edited stories on personal finance for Good Housekeeping and DuJour magazines and has written articles for The Wall Street Journal, Readers' Digest, Parade, Town & Country and Lifetime/A&E, among others. She is a graduate of the University of Michigan.
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