One of the reasons both the PPP and the Economic Injury Disaster Loan ran out of funds, is the program was too underfunded to begin with to deal with the scope of the problem slamming small businesses in this country, and Nancy Pelosi's refusal to extend them once this became obvious to the politicians without her unrelated priorities being met.
The second reason is because the system got played. For Example - Restaurant Business: While small operations struggle, chains land PPP loans
Why? Well banks certainly found it easier to administer and fund a single large loan to one borrower rather than many small ones, so that's what they focused on. After all, while the loans are guaranteed, they're only going to make about 1% on the transaction, so why work to process thousands of small loans when you can write one big check?
Many banks serving small businesses didn't even get their processing systems up to process small business applications when the program had funds - I'm looking at you Comerica.
So yep, my clients needing 50k which could keep their payrolls and businesses just afloat enough to survive this are told there's no funds available and they are out of options to survive at this point - and they still have to pay their quarterly payroll taxes now, not to mention the rent which is still due.
Meanwhile, the Kennedy Center got a bailout of $25 million specially designated for them outside of the PPP/EIDL program - and laid off most of their workforce, and chain restaurants were able to game the system and got $10-$20 million a piece.
1 comment:
Grrrr....
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