PPP Lifeline, the Big Picture, and Boring Facts - July 15, 2020
There has been no shortage of media headlines highlighting how celebrities, movie stars, and even rock bands have received loans under the Paycheck Protection Program. The program was designed so that small businesses could make rent payments and keep employees on the payroll.
Through July 13, the Small Business Administration said it has approved
- 4.9 million loans
- Loans totaling $517.5 billion dollars
- Average loan size of $105,328
86.5% of all loans were less than $150,000, 0.6% of approved loans were over $2 million, and 72-96% of estimated small business payroll was covered by PPP loans.
Thoughts – an imperfect program and unnoticed successes
Businesses that received the loans employ over 51 million people or 84% of all small business employees.
PPP enabled many non-profit organizations to access loans to support their employees. Traditionally, nonprofits are not eligible to receive SBA-guaranteed loans.
Crafted at the height of the economic crisis, the program has had its share of blemishes, and some folks received loans that otherwise shouldn’t have.
Additional headlines that shine a negative light on the program may continue to pop up.
Yet, let’s not let overlook the tremendous benefits to small businesses and the economy amid a crisis that forced closures of ‘non-essential’ firms through no fault of their own.
Sometimes, boring is good.