New York Businesses Receive $17B In Second Round Of PPP Loans

New York Businesses Receive $17B In Second Round Of PPP Loans

New York Businesses Receive $17B In Second Round Of PPP Loans

The Small Business Administration has so far approved loans to almost 4 million businesses. But the U.S. Treasury Department tweaked the rules before Congress replenished the fund, after reports surfaced detailing how many large companies had taken advantage of the program and gotten funding ahead of smaller businesses.

By industry segment, the analysis found that businesses in the retail trade and accommodation and food services -which were hard-hit by social distancing measures imposed to contain the pandemic - received more PPP funding than industries that likely lost less revenue, such as information, finance and insurance, and educational services.

The CARES Act provided $2.2 trillion in emergency funding, with almost $350 billion in relief loans to small businesses, but the controversy around the program has prompted high-profile recipients to return loans.

New York Attorney General Letitia James and a coalition of 23 additional attorneys general today called for key changes to the Paycheck Protection Program (PPP) to ensure that funds are distributed fairly and equitably to the small businesses that were the originally intended recipients of the loans.

The first round of funding-$350 million-lasted just 10 tumultuous days.

Last week the second round averaged about $35 billion in loans processed from about 442,000 applications per weekday, similar to what happened last month with the initial tranche.

The economists found "strong similarity" between states with high proportions of small business-bank financing relationships and PPP loan issuance. The SBA has yet to release loan-specific data about either program. Not everyone's buying the latter part - legal experts say the government would have to prove that companies understood what it was asking in the application process, which many companies say wasn't clear.

"Scrutiny over what businesses received loans turned into hysteria & is scaring many from applying", Rubio said on Twitter Friday.

There are also other options besides PPP with relief programs such as the Federal Reserve's Main Street Lending Program, said Paul Merski of the Independent Community Bankers of America.

"Before we forgive these loans, we'll check every single one over $2 million", Mnuchin said. Borrowers who do not meet the forgiveness requirements will have two years to pay off the loans before they mature.

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