Demand For The Paycheck Protection Program Is Drying Up

TOPLINE

After two rocky launches and a weeks-long flood of applications from cash-strapped small businesses across the country, demand for the embattled Paycheck Protection Program appears to be winding down. 

KEY FACTS

Key background

The CARES Act, signed into law by President Trump at the end of March, established the Paycheck Protection Program—a $350 billion program administered by the Small Business Administration to provide forgivable loans to cover payroll and overhead expenses, intended to keep mom-and-pop shops from folding. The program saw a rush of applications when it first opened and, as a result, ran out of money in just two weeks. A scrambling Congress then passed new legislation to restart the program with another $310 billion, with $60 billion of that money reserved for smaller businesses without existing banking relationships. That move was prompted by the intense backlash that emerged after news broke that dozens of public companies—with ample access to capital markets—had received millions of dollars in loans.

Further reading

With Another $3 Trillion Stimulus Package On The Line, Here’s Everything The Government Has Done To Rescue The Economy So Far (Forbes)

SBA Releases Paycheck Protection Program Loan Forgiveness Application: A Deep Dive (Forbes)

Good News For Small Businesses: Congress Could Extend PPP Loan Forgiveness Period (Forbes)

Five Numbers That Sum Up The Troubled PPP Program (Forbes)