CARES Act Overview | Lead Bank Community Bank


In response to the COVID-19 pandemic, President Trump on March 27, 2020 signed into law the Coronavirus Aid, Relief, and Economic Security (CARES) Act, a stimulus bill intended to bolster the U.S. economy, among other things, and provide emergency assistance to qualifying businesses and individuals.  The Act is aimed at reducing the economic impact of the coronavirus and authorizes $2.1 trillion in aid to various sectors of the economy.  Specifically, the CARES Act provides the Treasury with $454 billion to make loans, loan guarantees and other investments in Federal Reserve programs and facilities that will give support to eligible businesses, States and municipalities.

Among its many provisions, the CARES Act establishes two loan programs intended to provide liquidity to businesses in the United States: (1) The Keeping American Workers Paid and Employed Act, which creates the Paycheck Protection Program (PPP), and (2) The Coronavirus Economic Stabilization Act (CESA), which creates loan programs to be directed by the United States Department of the Treasury.

Paycheck Protection Program Round 2.0

$284 billion dollars of the relief package was allocated to fund PPP Round 2.0 loans. This legislation provides funding for new loans to small businesses and it also benefits businesses that had already received a PPP loan in 2020.

Paycheck Protection Program

The Paycheck Protection Program, PPP, is part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act intended to provide small businesses with cash-flow assistance.

Main Street Lending Program

The Main Street Lending Program will leverage the Treasury’s $75 billion equity investment of CARES Act funds to provide up to $600 billion in new financing to small and medium-sized businesses. 

Economic Injury Disaster Loans

The CARES Act extends the EIDL (Economic Injury Disaster Loans) program previously aimed at natural disasters to include the COVID-19 crisis. The CARES Act also authorized $10 billion in emergency grants to applicants for EIDLs, with a maximum of $10,000 per emergency grant. 

Student Loans

The CARES Act, which is the new multi-trillion dollar stimulus bill designed to help those impacted by the COVID-19, directly helps borrowers with student loans and provide financial relief from March 13, 2020 through September 30, 2020.

Other CARES Act Provisions

The CARES Act also includes the Coronavirus Economic Stabilization Act (CESA) and Loan Forgiveness Provisions.