Some small business owners waiting for a lifeline in the form of Paycheck Protection Loans under the $2.2 trillion stimulus package have held out hope that a second and smaller form of aid might keep them afloat in the meantime.

But as demand spikes for federal funds, new guidance and stalled payouts from the Small Business Administration on its Economic Injury Disaster Loans and advance grants are adding to frustrations and fears on Main Street.

Unlike PPP loans that go up to $10 million, small business owners can apply for disaster assistance of up to $2 million directly through the SBA, with $10,000 advance grants available even sooner. The SBA initially said so-called EIDL grants of up to $10,000 would be made available “within three days” of a successful application, but has since shifted language to say these advances would be available “within days” of a successful application.

The Massachusetts district office of the SBA on Monday said that the cash advances would be limited to $1,000 per employee, up to $10,000, a more detailed description of the initial “up to $10,000” language the administration had used. But that bulletin has since been taken down, adding to confusion about the availability and speed with which these might go out to businesses.

“Many small businesses made business decisions based on the $10,000 advance and were hoping for more speed, as expressed in the CARES Act,” Karen Kerrigan, president and CEO of the Small Business & Entrepreneurship Council said. “They understand the limits of government and there would be red tape, but they did not expect for the rules to change so dramatically.”

EIDL aid can be rolled into a PPP loan — businesses can qualify for both so long as they are not used for the same thing, and they must be used for approved expenses to be forgiven. Like the PPP funding, which government officials had initially said could be available “as soon as same day,” EIDL grants were also said to be delivered quickly to struggling businesses — both have turned out to largely be untrue.

On Thursday evening, a senior administration official told CNBC that nearly 4 million businesses had applied for EIDL funding for a total of $383 billion, adding that Congress has allocated $17 billion for the program. Amounts of grants and loan disbursements were not made available.

For Aaron Gerdeman, the clock is ticking. Gerdeman is self-employed with no other staff and owns a gym, Core Strong Fitness, in Dublin, Ohio. He’s applied for the state’s unemployment program and an EIDL grant. He plans to apply for the PPP loan Friday when the flood gates open for self-employed workers and independent contractors, with his bank, Chase, hoping that something comes through.

“I haven’t had any clients or generated any revenue since March 16. And I’m sitting here waiting to see what’s going on with the government aid. I’m hoping that we get some of this resolution to this very soon,” Gerdeman says.

Leaders from major advocacy groups including the National Federation of Independent Business and the Small Business & Entrepreneurship Council say that none of their members, to their knowledge, have received EIDL grants or PPP loans as of Thursday morning. In fact a new study from the National Federation of Independent Business finds that half of small business owners have applied for EIDL assistance with nearly all applying for the $10,000 grant. Just 4% were approved and 1% not approved.

“They are growing increasingly frustrated with the processing of these loans and a lack of communication about when they can expect to receive money if their loan is approved,” the survey finds.

More broadly, the PPP rollout itself has been flush with confusion and angst as banks large and small rush to process loans with extremely high demand. Business owners are waiting in queues with their banks on loan approval numbers from the SBA, with some banks claiming additional guidance is needed from the SBA to disburse the funds.

There have been few funded businesses to speak of, and a senior administration official told CNBC that disbursement information with regard to funding out the door from banks into the hands of businesses was not yet available, even as the government gets to work on a new $250 billion influx of support for the program. As of Thursday evening, some 550,000 applications had been assigned e-Tran loan numbers for a value of some $140 billion, with 4,100 lenders participating, up from 1,800 a week ago.

“For businesses with good, existing relationships with a lender, we have many reports of franchise owners receiving loan approvals. This is a welcome relief. However, many franchises are hamstrung by unanswered questions about loan eligibility and lender requirements,” the International Franchise Association said in a statement.

Some, like Jason Olsen, have been lucky and had a speedy lending process. Olsen owns Prestman Auto in Salt Lake City and applied on Saturday with his credit union, Mountain America, which he’s been working with for the last 10 years. By Tuesday, he was funded for an $890,000 PPP loan. He hasn’t heard anything about the status of his EIDL grant since applying with the SBA. For now, he gets to keep his 54 employees on the payroll.

“It was a shock—I would say this was 100% due to our banking relationship,” Olsen says. “It’s nice to know this moved quickly — we applied for the EIDL right away and haven’t heard anything.”

— With reporting from Hugh Son and Dawn Giel.

Originally published at CNBC

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