WASHINGTON (BRAIN) — The Small Business Administration announced Thursday it has no more money to assist small businesses affected by the COVID-19 pandemic and can't accept any more Paycheck Protection Program or Economic Injury Disaster Loan applications.
Treasury Secretary Steven Mnuchin and congressional members began meeting Thursday afternoon to discuss approving additional funding. As of 9 p.m. Eastern, no agreement had been reached.
The announcement about the exhausted funds was posted on the SBA's website and went on to say EIDL applications already submitted will be processed on a first-come, first-served basis. The lack of funds comes on the heels of the government saying Thursday that another 5.4 million filed for unemployment last week, bringing the past month's total to 22 million.
On Wednesday night, the SBA warned it was nearing the PPP's $349 billion loan limit. Along with the Treasury Department, the SBA jointly issued a statement later that night asking for Congress to approve additional funding.
Bicycle retailers affected by the pandemic have had mixed results getting loans, and PeopleForBikes has held three webinars in the past few weeks to help provide information and access to question SBA officials. Plagued by glitches and delays from lenders quickly reaching loan caps, and application and technical issues, the programs have frustrated many.
"We know that bike businesses and their employees are in desperate need of government assistance and are frustrated by the delays and the uncertainty of support," PeopleForBikes Chief Operating Officer Jenn Dice told BRAIN on Thursday. "Since the start of the COVID-19 pandemic, PeopleForBikes has been advocating for additional federal backing of struggling bike businesses. As Congress continues to negotiate a deal to inject another $250 billion into the Paycheck Protection Program, retailers should make sure their PPP and EIDL materials are ready to submit as new loans and grants become available."
The SBA said Wednesday it had processed more than 14 years' worth of loans in less than two weeks. On April 3, the Paycheck Protection Program went online and authorized $349 billion in forgivable loans, if all employees are kept on the payroll for eight weeks and the money is used for payroll, rent, mortgage interest or utilities.
The low-interest EIDL offered up to $10,000 to businesses experiencing a temporary revenue loss.
Both programs were offered to qualified small businesses with fewer than 500 employees. Businesses applying for the EIDL in certain industries may have more than 500 employees if they meet the SBA's size standards for those industries.
About 1.6 million applications were processed from 4,900 lending institutions during the PPP's first 13 days.
