WASHINGTON (BRAIN) — The Small Business Administration said Sunday it issued 2.2 million Paycheck Protection Program loans valued at $175 billion in the first week of the second round of federal funding during the COVID-19 pandemic.
Through Friday, the average loan size in the second round is $79,000, the SBA said. The average loan size in the first round was $240,000. The forgivable loan program received an additional $310 billion April 24 to restart after the $349 billion first round was exhausted on April 16.
As of the beginning of Monday, $135 billion remains in the second round.
In the second wave, more than 850,000 loans — about one third of the 2.2 million — were made by lenders with $10 billion of assets or less, the SBA said.
Since the Paycheck Protection Program launch on April 3, SBA processed more than 3.8 million loans for more than half a trillion dollars of economic support.
Lenders with asset sizes less than $1 billion (4,453) have issued 465,590 loans valued at $27 billion. The SBA said these lenders include Community Development Financial Institutions, Certified Development Companies, microlenders, Farm Credit lending institutions, and Fintechs. On April 29, the SBA gave lenders with asset sizes less than $1 billion an exclusive eight-hour window to submit applications from their clients. That came less than 24 hours after the SBA said all PPP loans in excess of $2 million will be scrutinized after several large companies had been securing them.
The SBA was criticized during the first round when companies, including Ruth's Chris Steak House and Shake Shack, received PPP loans before eventually declining them. The latest revelation came last week when the NBA's Los Angeles Lakers received — and returned — a $4.6 million PPP loan during the first wave.
On the same day the PPP ran out of funds, SBA said it would no longer take Economic Injury Disaster Loan applications. The EIDL received an additional $60 billion.
The low-interest EIDL offers up to $10,000 to businesses experiencing a temporary revenue loss. Both programs are 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.
The PPP loans are forgivable if all employees are kept on the payroll for eight weeks and the money is used for payroll, rent, mortgage interest or utilities.
PeopleForBikes, which has continued to advocate for additional funding, has recommended retailers have all financial material prepared before contacting their lender. PFB says questions about the PPP and eligibility should be directed to their lender, local SBA office, lawyer or business insurance agent.
