The Paycheck Protection Program Has Run Out Of Money

By: First Union | Date:

business-strategyresources

The Paycheck Protection Program Has Run Out Of Money

See Your Loan Options

Get Started

The Small Business Administration announced on Tuesday that the Paycheck Protection Program has run out of money for most borrowers before its estimated date May 31st. The program plans on only accepting a few applications from Community Financial Institutions which is for minority borrowers. Previously, $8 billion was set aside to serve the minority businesses.

Don’t be afraid if your application is still in outstanding. The SBA will continue to fund outstanding approved PPP applications from other lenders, but they won’t accept new applications.

The funds running out came weeks after the PPP announced to be extending through the end of May, so borrowers had more time to apply, but the funds were not expected to end so soon.

How the Paycheck Protection Program Started

The Paycheck Protection Program was established in March 2020 as part of the CARES Act due to so many businesses needing help because of the Coronavirus pandemic. The program has given more than $780 billion in forgivable loans to more than 10.7 million borrowers.

In 2021, Congress gave about $292 billion to a new round of the program which allowed businesses to apply for a second round. Also, the Biden administration made the qualifications less strict, changed the loan calculation formula for sole proprietors, and gave small businesses a priority window.

Making the qualifications less strict helped borrowers who had been denied forgivable funding loans. This was due to banks and borrowers calling on the SBA and Congress to make the rules better, so it can help more businesses while the economy opens back up.

What Can Small Businesses Do Now?

If you missed out on the Paycheck Protection Program, there are other relief programs that are available through the SBA that can help small businesses. The Restaurant Revitalization Fund started on May 3rd. The program is part of the $1.9 trillion stimulus package and allocated $28.6 billion in funding. The SBA will only approve applications from small businesses that are owned by women, veterans, or socially and economically disadvantaged people in the first 21 days.

Some are worried that the funding won’t be enough to help all businesses that need support during these difficult times. According to a White House report, the program received 186,2000 businesses that applied for funding in the first two days.

The SBA reopened applications for the Shuttered Venue Operators Grand Program in April, which has $16 billion in funding for theater owners and other venue operators that have closed during the pandemic. The SBA will approve applications, starting with the ones that lost the most revenue first.

With the Payment Protection Program out of money, these programs are essential for small businesses now.

First Union Lending is here to help. If you need additional capital for your business, we have the resources for you. With short-term loans and SBA loans among other products, we get you the cash you need quickly. Call today!

Better Business Bureau
5 star rating
Trustpilot reviews

First Union Lending LLC is a dually licensed Lender/Broker with its main offices located at 4900 Millenia Blvd First Floor Orlando, FL 32839. First Union Lending LLC and its ads are meant for continental United States, including Alaska and Hawaii small business owners. Business Loans offered by First Union Lending LLC have varying rates and terms that can range from 30 - 120 payments and all rates and terms are based on eligibility of the business and its owners. The actual terms are based on credit, business history, industry, amount and terms. As an example, a $5,000 loan paid over 5 years at 8% would have a total repayment of $6,082.92 over the life of the loan. We use the latest encryption to protect sensitive information transmitted online, as well as run our own secure server network to ensure your information is protected offline as well.

Copyright © First Union Lending, LLC. 2021