As small businesses try to beat the odds to get a piece of the latest round of first-come, first-served Paycheck Protection Program (PPP) money, $175 billion worth is already out the door.
CNN reported that the Trump administration said on Sunday (May 3) that 2.2 million small business loans have been issued with an average loan size of $79,000. That leaves about $135 billion available.
Last Monday (April 27), the Small Business Administration (SBA) began accepting applications for the second round of PPP.
Larry Kudlow, the White House's top economic adviser, told CNN's Jake Tapper that the administration may consider more money for the program. “This has been an extremely popular and effective program, no question about it,” he said. “You know, keeping folks on the payroll is so important. We will be looking at that."
The $484 billion COVID-19 rescue bill signed late last month by President Donald Trump included $310 billion in new money for the latest bailout. The initial round of $350 billion in forgivable PPP loans, which was allocated as part of the $2.2 trillion CARES Act stimulus, were exhausted in less than two weeks.
The loan will be forgiven if employees are kept on the payroll for eight weeks and if the money is used for payroll, rent, mortgage interest or utilities.
“The Paycheck Protection Program is providing critical support to millions of small businesses and tens of millions of hardworking Americans," said Treasury Secretary Steve Mnuchin and SBA Administrator Jovita Carranza in a joint statement on Sunday (May 3).
Last Monday’s rollout was not without bugs. The SBA’s online application platform was almost immediately overwhelmed by the number of potential borrowers. A last-minute change limited the number of loans a lender could submit at one time, which appeared to bring the site to a crawl.
By the end of last week, Bank of America CEO Brian Moynihan said the glitches had been worked out and the application process had improved. He said BoA has processed 231,000 PPP loans representing about $24 billion.
To make sure PPP funds reach small businesses, the Treasury updated its rules to only allow companies with less than $1 billion in assets to apply.
On Monday (May 4), the SBA announced in a tweet that they are seeking temporary employees to help with “COVID-19 and disaster relief efforts.”
CNN reported that as Democratic lawmakers advocated on Capitol Hill for additional stimulus funding for state and local governments battling COVID-19, Kudlow said there may well be additional legislation. "... there's kind of a pause period right now," he told the network. "I don't want to rule in or out anything right now. We are in discussions internally and with leading members of Congress.”