Nearly a month ahead of its deadline, the SBA announced yesterday that the PPP program has run out of funding and the agency will not process new applications for most businesses. “After more than a year of operation and serving more than eight million small businesses, funding for the bi-partisan Paycheck Protection Program has been exhausted," said an SBA spokesperson.
The SBA will continue to accept applications from some minority-owned and underrepresented businesses, but no other new applications will be accepted. Here’s what you need to know.
Some PPP Funding Remains for Community Banks
The PPP program has not entirely exhausted its funds. $8 billion remains in a set-aside for community financial institutions, or CDFIs. CDFIs are financial institutions that work primarily with minority and underrepresented businesses. The SBA will continue to accept new applications from CDFIs until the remaining $8 billion in funding runs out.
Many Businesses Still Haven't Received Funding
Although millions of business owners were offered PPP loans, our latest poll indicates that there were also many applicants who weren't approved for the program.
According to a recent survey we conducted, only 63% of respondents who applied for PPP funding this round had gotten approved and funded. We received comments from business owners all over the U.S. that they either weren't approved or have outstanding applications that haven't been processed yet. If you applied for PPP funding but didn’t receive it (or won’t be able to now that the program has closed), you’re not alone.
What if My Application Has Already Been Approved?
If your PPP application has already been approved by your lender, you will still be able to receive funding. According to the SBA’s statement, the agency will continue processing applications already approved. However, if your application hasn’t been approved by your lender yet, you likely won’t be able to receive funding from the PPP.
Will More Funding Be Approved?
It’s possible that Congress will approve more funding for the PPP, because there is pressure from small business advocates and some lawmakers to do so. Ben Cardin, a Democrat from Maryland and the chair of the Senate’s small business and entrepreneurship committee, “remains open to a bipartisan agreement to add funds to the program,” according to a spokesman. However, as the U.S.’ economic recovery has progressed, Congress has mostly focused on targeted funding for hard-hit industries such as restaurants and entertainment venues. We will keep you updated if more PPP funding is approved.
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