A few weeks ago, business owners anxiously waited for Congress to enact legislation that would help them stay afloat during this COVID-19 crisis. The good news is that Congress allocated $365 billion to fund the Protection Paycheck Program (PPP) and the Economic Injury Disaster Loan Program. The bad news is the money for the Paycheck Protection Program is already gone, and thousands of businesses are in desperate need of loans to pay employees and maintain their operations.
On April 15, the Small Business Administration announced, “The SBA has processed more than 14 years’ worth of loans in 14 days. We urge Congress to appropriate additional funds for the Paycheck Protection Program—a critical and overwhelmingly bi-partisan program. At this point, we will once again be able to process loan applications, issue loan numbers, and protect millions more paychecks.”
When the $2 trillion stimulus package was enacted, both President Trump and Congress were aware that additional funding could be required to support small businesses adequately. Based on the inability of the SBA to process new PPP loan requests, Congress is currently working on new legislation that could potentially provide the program with an additional $250 billion in COVID-19 relief loans.
Chamber of Commerce Requests Swift Action
It was clear early on that the demand for PPP loans far exceeded the supply. The U.S. Chamber of Commerce estimates 54 percent of small businesses report they are currently closed or could close within weeks. By April 10, 250,000 small businesses and sole proprietorships had applied for more than $100 billion. They were then joined by independent contractors, the self-employed, and gig economy workers who make up 80 percent of the small business operators.
To date, the Chamber has sent two letters to Congress, urging that new PPP funds become available quickly. “Small businesses need Congress to act. No family and no business should be bankrupted by the temporary economic disruption caused by the coronavirus pandemic. Congress’s urgent action is needed to replenish EIDL and bolster PPP, and to help small businesses survive.”
Line Sooner Rather than Later
It’s only a matter of time before Congress allocates more PPP funds. If you haven’t already applied for a loan, get in touch with your lender to find out if they are still accepting applications. Be proactive and avoid waiting until Congress signs on the dotted line. This action will help ensure your loan will be approved when funds become available. At this point, applicants fall into three categories:
- Approved and received funds
- Approved, yet haven’t received funds
- Applied, but haven’t received approval
If your application has been approved, banks are required to release funds within ten days of approval. This should not be an issue since banks are committed to assisting in getting the economy back on track and keeping small businesses viable. Neil Bradley, U.S. Chamber of Commerce vice president and chief policy officer, suggests that those who have already applied but haven’t heard from the bank should follow-up to determine the status of their application. If the loan has been approved, it will have a number and is included in the existing PPP loan.
Informed About the Latest Developments
Access to the correct information is critical during this time of uncertainty. The U.S. Chamber of Commerce, Small Business Administration, and the National Retail Federation are dependable resources. They can provide you with current updates and relevant information that can assist you in acquiring PPP and EIDL loans, and better understand the government’s response to the coronavirus.
of the U.S Chamber of Commerce
Register for National Small Business Town Hall Meetings
During these free live webinars, Neil Bradley informs business owners about COVID-19 resources. Registration is now open for the town hall meeting on Friday, April 24, at 12:00 p.m., Eastern-timehttps://www.uschambers.com/events/upcoming-events
Emergency Loans: Small Business Guide
of the National Retail Federation
Small Business Administration: Coronavirus (COVID-19) Small Business Guidance & Loan Resources
Small Business Relief Under the Cares Act: Summary and
How-to-Guide from Steptoe
National Governor’s Association: Coronavirus—What you
need to know
State Resources for Retailers
Job Opportunities for Workers Displaced by COVID-19