COVID Loan Tracker Recommends an Additional $400 Billion in Payment Protection Program Loan Funding
COVID Loan Tracker, a digital community of small business owners across America who are passionate about supporting the capital and credit needs of small businesses during the coronavirus pandemic, today applauded the addition of $310 billion into the federal Paycheck Protection Program (PPP), but cautioned that the new funding drastically underestimates the need among small businesses for financial help as they navigate the current crisis. COVID Loan Tracker encompasses 24,000 small businesses across the country.
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“The second round of funding for the Paycheck Protection Program is a much needed boost for small businesses who have, with determination and perseverance, been shouldering the economic impact of the coronavirus epidemic for weeks,” said Duncan MacDonald-Korth, Co-founder of COVID Loan Tracker. “That said, it is clearly insufficient. The Small Business Administration’s funding amount is based on flawed assumptions of the demand for PPP loans remaining after its initial allocation in early April. The need among small businesses is much higher, and even with this relief, more funding will be needed in a matter of weeks, if not days.”
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According to COVID Loan Tracker’s estimates, at least $400 billion, in addition to the funds just allocated and the $349 billion allocated on April 3, will be needed to satisfy the outstanding need. The government’s shortfall stems from its assumption that if the $349 billion allocation was sufficient to fund 1.7 million applications in the first round, that $310 billion should be enough for the estimated 1 million applications that were “stranded” in process when the funding ran out on April 16.
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