Biden Revises Small Business Lending To Reach Minority Small Businesses | WJHL
WASHINGTON (NewsNation Now) – US President Joe Biden on Monday announced changes to target more federal pandemic assistance to the country’s smaller businesses and businesses owned by women and people of color.
Biden says many of these family businesses “were pushed aside” by big business seeking federal funds early in the pandemic. He said the changes taking effect on Wednesday would bring long-awaited help to those small businesses he said are “crushed” by the economic downturn caused by the pandemic.
“America’s small businesses are hurting, hurting badly, and they need help now,” Biden said.
As part of the pandemic-era paycheck protection program, the administration sets a two-week window, starting Wednesday, during which only companies with fewer than 20 employees – the overwhelming majority of small businesses – can apply for forgivable loans.
Biden’s team is also allocating $ 1 billion to sole proprietors, such as building contractors and beauticians, the majority of whom are owned by women and people of color.
Further efforts will remove the ban on lending to a business that is at least 20% owned by someone arrested or convicted of a non-fraudulent crime in the previous year, and allow those who are behind on their student loans federal authorities to request relief through the program. The administration also clarifies that non-citizen legal residents can apply for the program.
First rolled out in the early days of the coronavirus pandemic and renewed in December, the program was intended to help Americans stay employed during the economic downturn. It allows small and medium-sized businesses suffering from lost income to access federal loans, which are repayable if 60% of the loan is spent on payroll and the balance on other eligible expenses.
The Biden effort aims to correct disparities in the way the program has been administered by the Trump administration.
Paycheck Protection Program data released on December 1 and analyzed by the Associated Press shows that many minority homeowners desperate for a relief loan only received it in the last few weeks of the P3, while many other homeowners white businesses were able to obtain loans earlier in the program.
The program, which began on April 3 and ended on August 8 and granted 5.2 million loans worth $ 525 billion, has helped many companies stay afloat when government action to controlling the coronavirus have forced many people to shut down or operate at reduced capacity.
The latest PPP, which began Jan. 11 and ends at the end of March, has already disbursed $ 133.5 billion in loans – about half of the $ 284 billion allocated by Congress – with an average loan of less than $ 74,000 .
A new program renewal is not included in Biden’s $ 1.9 trillion “US bailout”, which he hopes Congress will adopt in the coming weeks.
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