White House Announces PPP Changes Aimed At Smallest Businesses
The Biden Administration on Monday announced changes to the Paycheck Protection Program, which extends forgivable loans to businesses struggling during the pandemic, designed to prevent large firms from crowding out small and minority applicants the way they did last year.
For a two-week period starting Wednesday, only businesses with fewer than 20 employees will be able to apply for the forgivable loans.
The Administration will also tweak loan eligibility requirements that have restricted loans to applicants with prior felony convictions, applicants who are delinquent on their student loans and noncitizen applicants who are lawful U.S. residents.
The current tranche of PPP funding was authorized by the $900 billion stimulus package signed by President Trump in December.
The program reopened in January with changes designed to better target relief to underserved smaller businesses and a new rule that allowed businesses with significant losses to apply for second loans.
The PPP was established by the $2.2 trillion CARES Act last March. It was designed to provide forgivable loans for overhead and payroll costs to help see struggling small businesses through the pandemic. After an overwhelming crush of applications and a chaotic launch period, the program faced criticism because large public companies had received multimillion-dollar loans while smaller companies without strong banking relationships had been shut out of the process entirely.
11%. That’s the portion of PPP recipients that say they are very confident they will be able to maintain payroll without further government relief, according to a new survey from Goldman Sachs.
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