Lenders ask Treasury to focus PPP cycle on SMEs
The largest banks in the United States were reportedly in talks with the Treasury on Monday, April 20, over the next round of funding for the Paycheck Protection Program (PPP) and how best to ensure it gets into. the small business bank accounts that need it most.
Senior bank executives are trying to find a way to “fill the gap” in the PPP which has extended repayable and government guaranteed loans to large companies worth millions and employing thousands of employees. National restaurant chains have crushed small, family-owned cafes and large law firms have taken the lead ahead of Main Street businesses, according to FOX Business report Tuesday April 21, citing sources.
Congress is negotiating another round of government-backed small business loans, and JPMorgan Chase confirmed to Fox on Monday that its source was correct and that the bank was “in discussions with [the] Treasury ”to find a way to fill the gaps in the PPP.
National Write Your Congressman, a small business advocacy group, said 70% of small businesses tried to get P3 loans in the first round. Banks, however, were only able to grant loans to 46% of applicants. “Hundreds” of SMEs told Fox they had no money and couldn’t understand why big restaurant chains like Ruth’s Chris Steakhouse and Potbelly Sandwich Shop got loans.
The PPP legislation was supposed to help SMEs struggling to survive amid stay-at-home mandates and business shutdowns and downturns. The CARES Act allocated $ 350 billion in low-interest repayable loans to help small businesses with fewer than 500 people stay afloat and continue paying their employees.
The National Restaurant Association reported that approximately 417,000 restaurant workers lost their jobs in March. This figure is six times higher than in October 2000, the last record drop recorded in the industry, according to the Blog ZeroHedge.
Democrats and Republicans in the Senate are approaching a agreement this would add more than $ 400 billion to the PPP.