Small Business Administration Paycheck Protection Program

Covid-19 Small Business Administration Paycheck Protection Program

Going forward, the Small Business Administration (SBA) will be a key scaled funding resource for businesses with under 500 employees: the CARES Act appropriated almost $350 billion to the new Paycheck Protection Program. The program facilitates zero-to-low interest loans that are forgivable if businesses retain their employees through June 2020, making them similar to repayable grants if conditions are met. In addition, applicants can qualify for a $10,000 forgivable advance (grant) within three days of application. The program appears to be well structured and accessible, but the quantity alone represents a massive distribution and execution challenge for many banks and the chronically underfunded and understaffed SBA (and may nonetheless prove to be insufficient in scale).