Small Business Majority Comments on PPP Loan Data for California Businesses
More than 2,500 California small businesses received less than $1,000 from PPP, with some receiving as little as $1
Washington, DC – Today, Mark Herbert, Vice President, California at Small Business Majority, issued the following statement after the Small Business Administration (SBA) released loan data for the Paycheck Protection Program (PPP).
“As our state experiences a second wave of business closures and rising coronavirus cases continues to test consumer confidence, the gaping holes and inconsistencies in the loan data are troubling. Serious questions remain about how well PPP has served the smallest, most vulnerable businesses. It is unclear whether funds were equitably distributed to minority-owned businesses, and there is an alarming rate of small-dollar loans.
In California, there were more than 2,500 small businesses, many with multiple employees, that received a loan for under $1,000. Even more eyebrow-raising, 290 of those businesses received less than $100--with some receiving loans as little as $1.00. Underfunding has been a pervasive problem for borrowers since PPP launched. About one in every four small businesses in our network have reported receiving a lower loan than what they requested. Many business owners received no explanation for why they did not receive the full loan amount, while others were told to accept less than what they would qualify for to move things through the process quickly.
The SBA has already recognized that demographic information is lacking, and it plans to collect this data during the forgiveness process; however, more information is needed. Moving forward, SBA must revise the information to include the amount requested by a borrower and the amount received, and publicly commit to reporting revised data on a rolling basis now, and through the forgiveness process.
The future of California’s small businesses depends on rectifying PPP’s shortcomings, and to do so we must not allow those small businesses that were grossly underfunded or disadvantaged by the program to go unnoticed and unhelped.”
About Small Business Majority
Small Business Majority was founded and is run by small business owners to ensure America’s entrepreneurs are a key part of a thriving and inclusive economy. We actively engage our network of more than 65,000 small business owners in support of public policy solutions and deliver information and resources to entrepreneurs that promote small business growth. Our extensive scientific polling, focus groups and economic research help us educate and inform policymakers, the media and other stakeholders about key issues impacting small businesses and freelancers. Learn more about us on our website and follow us on Twitter, Facebook and Instagram.