New PPP window for small businesses

NH Business Review
Published: 3/2/2021 9:53:09 AM

Participation in the second round of the Paycheck Protection Program has slowed in New Hampshire and across the nation, just as the U.S. Small Business Administration takes a break to focus only on the smallest businesses, which should slow the pace of overall lending even further.

Through March 10, the SBA will only allow businesses with fewer than 20 employees, including sole proprietors, to participate in the PPP.

The change is intended to increase aid to the very smallest businesses, many of which are run by women, Black people and members of other minority groups whose participation has been at a slower pace than their larger counterparts.

On its website, the SBA says it will step up outreach efforts to “improve the emergency relief ‘digital front door’ and conduct extensive stakeholder outreach.” It also said it will “strengthen its relationships with lender partners to advance equity goals.”

Amy Bassett, the SBA’s New Hampshire director, said that the agency will “develop new collaboration to do additional target outreached” to the smaller businesses, but noted that targeted outreach has been a focus since the new round began in January.

The agency has already held a webinar through the New Hampshire Center for Nonprofits, another for sole proprietors and hosted an event with the NAACP discussing entrepreneurship.

Smaller loans

Yet as the SBA is stepping up its outreach, the number of participants in the program is declining.

So far in the second round, the SBA has approved more than $775 million for 8,222 businesses in New Hampshire, including 881 businesses in the week for $71 million in the week ending Feb. 21 – quite a drop-off from the previous week, when nearly 1,300 business got more than $108 million.

The average loan size is getting smaller as well. It’s now just a little bit over $94,000 in New Hampshire, compared to $108,000 when the program kicked off.

Nationally, there was also a falloff in lending. For the week ending Feb. 21, a total of 245,000 businesses received $14.5 billion, compared to the previous week, when 383,000 businesses took out nearly $25 billion. All told, some 1.9 million U.S. businesses have gotten $140 billion – slightly less than half the $284 billion allocated for a program that’s set to expire March 31.

Meanwhile, the latest report on PPP equity shows that as of Feb. 19 that $40 billion of the loans went to businesses with fewer than 10 employees. And while some 83% of the businesses taking PPP loans took an average loan of under $100,000,those loans added up to 29% of the total disbursed. Nearly half of the money went to those with loans of more than $250,000.

These articles are being shared by partners in The Granite State News Collaborative. For more information visit collaborativenh.org.




Concord Monitor Office

1 Monitor Drive
Concord,NH 03301
603-224-5301

 

© 2020 Concord Monitor
Terms & Conditions - Privacy Policy