PPP 4.20 Update: Cannabis Businesses Ineligible

We have received several questions regarding eligibility of cannabis-related businesses and today seems to be the, ahem, appropriate date to address the question.

Although not mentioned in IFR Three, SBASOP 50 10 5(k) notes that both “Direct Marijuana Businesses” (DMB), which touch the plant in the industry parlance, and “Indirect Marijuana Businesses” are ineligible for SBA loans generally and thus ineligible for a PPP loan.

“Indirect Marijuana Businesses” include those which derive any revenue from sales to Direct Marijuana Businesses of “products or services thatreasonably could be determined to aid in the use, growth, enhancement or other development of marijuana”.

However, the SBA clarifies that this does not pick up the “plumber who fixes the sink” or company who repairs a DMB laptop that, say, crashed (into me…).