Next round of small business loans under controversial coronavirus aid program begins Monday
Small businesses that missed the first round of loans under the Federal Paycheque Protection Program can apply for a new round of pandemic-related emergency loans starting Monday.
The $ 310 billion second-round bids, which Congress approved this week after an initial fund of $ 349 billion quickly depleted, will be accepted by participating lenders starting at 7:30 a.m. Monday, the Commission said on Friday. Small Business Administration.
“Our economy depends on small businesses, so we must do everything in our power to make sure they survive the impact of this horrific pandemic,” said Jeremy Field, regional administrator for the SBA Pacific Northwest Region, in a press briefing on Friday.
The loan program, created in response to last month’s $ 2.2 trillion pandemic as a way to avoid layoffs, has been hailed by some as a lifeline for small businesses, which no do not need to repay loans if they are primarily used to retain or rehire employees. In Washington, the SBA oversaw 30,421 loans totaling $ 6.96 billion before the program ran out of funds last week.
But the program has also been criticized for underestimating the amount of money needed for small businesses during the pandemic and for failing to make loans more accessible to small businesses. Some small business owners in Seattle said they were unable to apply for a loan or were not approved before the funding ran out.
Critics also say the program has favored large companies, as well as those in sectors relatively untouched by layoffs. According to the Wall Street Journals, SBA loans of $ 1 million or more accounted for just 4% of all applications, but accounted for almost half of the money loaned – a trend that indicated that ” received a disproportionate share of aid, ”said Times.
An analysis of the Urban Institute found that the accommodation and food services industry, which accounted for almost two-thirds of job losses in March, received just 9% of program funds, while the professional, scientific and engineering, which saw an increase of 7,500 jobs during that time, secured 12.3% of program funds – the second largest share, behind only construction.
Field pointed out that $ 60 billion of the new funds are earmarked for “community lenders and small lenders.” The SBA is also working with chambers of commerce and other local business organizations to help small businesses access program funds, which even critics have recognized as one of the largest and most ambitious relief efforts in the world. the history of the United States. As Field himself noted, “it’s a marathon that we run at the pace of a sprinter.”