SMBs Wait for What's Next After PPP Funds Run Out
Two weeks after its launch, the Payment Protection Program's (PPP) $349 billion in small business loans has run out, leaving hundreds of thousands of small businesses that didn't receive funding scrambling for assistance. Additional bailout money is under discussion in Congress, yet president and CEO of Atlanta's Federal Reserve Bank Raphael Bostic anticipates upwards of $500 billion a month will be required to accommodate those in need.
As part of the $2.2 trillion Coronavirus Aid, Relief, and Economic Security (CARES) Act, $349 billion was set aside for small- to medium-sized business (SMBs) under the PPP—funds that were exhausted late last week. In an interview with Reuters, Bostic said his staff completed an analysis to understand how much SMBs need to see where the PPP fell short.
"Using that as a benchmark might give us some guidance. … It would not be good to lose them," Bostic said of the millions of businesses with fewer than 500 employees. "It is my sense that there are lots of businesses that may have needed this support and did not get it, and we need to make sure they get whatever support."
At this time, it is unknown when the next round of funds will roll through for SMBs or how much will be set aside.
—Andrew Michaels, editorial associate