Despite early glitches and overwhelming demand, the Small Business Administration processed more than 100,000 Pay-check Protection Program loans by more than 4,000 lenders. Some participating lenders reported trouble accessing the SBA or PPP application website. Twice as many users were trying to access the application website on Monday compared with at any time during the first round of the program, SBA administrator Jovita Carranza said.
PPP is receiving additional funding, which is good for small businesses. In the beginning government did put $349 billion for the usage of small businesses. For making it through this economic slowdown but seemed like large businesses needed them as much small businesses do. Most businesses with fewer than 500 employees and non-profit organizations were eligible to apply for loans of 2½ times their monthly payroll.
However, the money went quickly. The program opened April 3 for small businesses, and on April 10, sole proprietors and contractors became eligible to apply. Funding was exhausted April 16, leaving many of the smaller businesses without a chair when the music ended. To add to this frustration, it became evident that many of the larger “small businesses” were taken care of first, leaving many “Main Street” businesses without a loan. But more money is on the way, as legislation passed this week will put $310 billion back into the program.
The intense demand for the small-business program comes as several large companies have returned loans they received in the program’s initial days. The SBA revised its guidance last week to make clear that large, publicly traded companies with other financing options should not apply for the loans and warned that recipients may be asked to certify that the money was necessary enough to maintain operations.
For some employers, that clock has already started even as many states remain under stay-at-home orders. That could make it difficult for employers — such as a restaurant owner — to pay a full roster of employees. The eight-week rule could result in various hardships for these business as the would probably at the stake of being wound up.