Growth Club
1851 Growth Club
The PPP Loan Application Deadline is Today
The SBA program still has $130 billion available for small businesses.
Tuesday marks the final deadline for businesses hoping to submit applications for Paycheck Protection Program loans, and the program is still flush with cash.
The PPP loan program was introduced in March and quickly ran through its initial $350 billion in funding. When an additional $310 billion was provided in April, fears that the second round of funding would be depleted just as quickly were only slightly allayed by the wave of national chains that committed to returning their PPP loans after public outcry over how PPP loans were being awarded.
According to an official SBA report released Saturday, not only has the program not run out of cash, it currently has as much as $130 billion still unspent. Unfortunately, as Eater.com points out, that surplus cannot be attributed to a lack of need among small businesses. Rather, the program has been largely ineffective in distributing loans to the businesses that need them most.
Among those that have struggled most to secure loans since the economic downturn are Black restaurant owners, who already faced disproportionate challenges and hurdles when attempting to secure funding for their businesses before the pandemic. Even as money was returned in May, Black and Latino restaurant owners continued to have difficulty accessing resources, and the loans they were granted were almost always lower than the ones they requested, according to a study done by the Global Strategy Group.
The loan program likely wouldn’t have stalled — or at least, not so dramatically — if more resources had been put into reaching and supporting communities that have historically been ignored and avoided by major banks and lenders. Instead, these businesses were left to fend for themselves.
With the arrival of the application deadline today, it remains unclear what the SBA will do with the remaining funding, and some legislatures are pushing the SBA to extend the program or use the remaining funds to provide further relief.
