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Biden administration changes PPP rules to help reach the smallest businesses

February 22, 2021. Summarized by summa-bot.

Compression ratio: 74.1%. 2 min read.

The Biden administration announced several changes Monday to the Paycheck Protection Program in an effort to reach minority-owned and very small businesses that may have previously missed out on accessing loans to help weather the coronavirus pandemic.

(CNN)The Biden administration announced several changes Monday to the Paycheck Protection Program in an effort to reach minority-owned and very small businesses that may have previously missed out on accessing loans to help weather the coronavirus pandemic.

Starting Wednesday, small businesses with fewer than 20 employees will have a two-week exclusive window to apply for the funding.

The loan program will also open up to small business owners with non-fraud related felonies, those delinquent on their federal student loans and some non-citizen residents, such as Green Card holders or those in the country on visas -- all of who were excluded earlier.

"While the Paycheck Protection Program has delivered urgent relief to many businesses across the country, the initial round of PPP last year left too many minority-owned and mom and pop businesses out while larger, well connected businesses got funds quickly," said an administration official on a call with reporters Sunday.

Congress created the forgivable loan program last March to help hard-hit small business owners who had to close their doors because of state and local pandemic lockdown measures.

The first round of loans was slow to reach the smallest businesses and those without an existing relationship with a lender may have missed out.

The program closed in August, but lawmakers added funding in December and reopened the program so that owners could apply for a second loan.

Congress targeted the new loans to those with fewer than 300 employees that have seen drops of at least 25% of their revenue during the first, second or third quarters of 2020.

Lawmakers also carved out $12 billion for minority-owned businesses.

Since the program reopened, about $134 billion has been lent to 1. 8 million small business owners.

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