- February 22, 2021
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Biden Administration plans an ease for Small Businesses to get PPP Loan
Listen to this articleUS President Joe Biden has announced that his administration is changing the PPP (Payment Protection Program). The move came in an effort to provide more equitable access to applicants, especially those with the smallest of small businesses, those who live in rural communities, and with owners who are women or of color. President Biden made remarks on Monday at the White House and said that it is starting on Wednesday for a two-week period. Only businesses with 20 employees or fewer will be able to apply for relief through the PPP program. Many of these businesses had trouble obtaining relief in the early rounds of PPP, which was aimed at helping Americans keep their jobs. Biden said, “The way the Paycheck Protection Program was passed, a lot of these mom-and-pop businesses got muscled out of the way bigger by companies who jumped in front of the line”.
The first iteration of the program started soon after the beginning of the pandemic slowed or brought many US businesses to a halt, from 3rd April through 8th August. It provided 5.2 million loans worth a total of $525 billion and helped many businesses stay on their feet, supporting some 51 million jobs. The latest round of the program has paid out $133.5 billion in loans and about half of the $284 billion allocated by Congress with an average loan under $74,000. Point to be noted that the program will end in late March 2021. President Biden’s $1.9 trillion American Rescue Plan does not contain funding for PPP. But the President promised to give more financial help to sole proprietors, independent contractors, and self-employed individuals, and to change the program to broaden its availability.
The termination of current restrictions is among the changes announced on Monday. It cuts off PPP aid from small business owners with prior non-fraud felony convictions or to those who are delinquent on their student loans. President Biden also said that his administration’s changes to the system would also help improve access for non-citizen small owners who have reached out for PPP assistance. He referred to these small businesses as the Glue, Heart, and Soul in communities and of our economy”. Biden said the changes are a starting point, not an ending point. He also said, “We need Congress to pass my American Rescue plan because it would deal with the immediate crisis facing our small businesses”. The plan targets $50 billion to support the hardest hit small businesses after this program expires at the end of March.
