Small business owners feel they’re in a race for their livelihoods. When they learned $349 billion in forgivable loans would be paid out on a first-come, first-served basis, they made a mad dash to apply the day the program opened.
“It’s a wild grab for cash. People’s livelihoods are on the line,” said Evan Brownstein, who operates five restaurants in Los Angeles.
But the Paycheck Protection Program, or PPP, as it’s known, wasn’t ready for prime time when it launched on April 3. Many lenders have been slow to accept applications because they needed more technical guidance from the Treasury Department and the Small Business Administration. The SBA’s electronic system went down for a spell. And with both agencies updating guidance and amending forms, there is still confusion as to what the rules really are.
Borrowers’ fears that the program’s funding could run dry are warranted. There has been outsized demand for the loans already and one banking analyst predicts it will all be spoken for by next week. There is, however, an expectation that Congress will consider adding more money to the fund.