WASHINGTON (AP) – President Joe Biden on Monday announced changes to target more federal pandemic aid to the smallest businesses and businesses in the country owned by women and coloreds.
According to Biden, many of these mother and pop businesses were ‘cleared away’ by larger businesses seeking federal money in the early days of the pandemic. He said changes coming into effect on Wednesday would long have helped these smaller businesses, which he said were being “crushed” by the economic downturn driven by the pandemic.
“America’s small businesses are hurting, hurting and they need help now,” Biden said.
Under the paycheck protection program from the pandemic era, the administration is setting up a two-week window starting Wednesday, in which only businesses with less than 20 employees – the vast majority of small businesses – can apply for the forgiving loans.
Biden’s team is also cutting $ 1 billion to run one-man businesses, such as home contractors and beauticians, most of which are owned by women and coloreds.
Other attempts will remove the ban on lending to a company with at least 20% ownership by a person arrested in the previous year or convicted of a non-fraudulent crime, as well as those behind their federal student loans, enable the program to seek relief. The administration is also explaining that legal residents from outside the country can apply to the program.
The first time in the early days of the coronavirus pandemic and renewed in December, the program was intended to keep Americans employed during the economic downturn. It offers small and medium-sized businesses that have a loss of revenue, access to federal loans, which are forgivable if 60% of the loan is spent on the payroll, and the balance on other eligible expenses.
The Biden effort aims to redress the difference in the way the program is applied by the Trump administration.
Data from the Paycheck Protection Program, released on December 1 and analyzed by The Associated Press, show that many minority owners desperate for a relief loan have only received the PPP in the last few weeks, while many more white business owners previously was able to get loans. the program.
The program, which began on April 3 and ended on August 8 and distributed 5.2 million loans worth $ 525 billion, helped many businesses stay afloat when government measures to control the coronavirus forced many to quit or work with a reduced ability.
The latest EMP, which began on January 11 and runs until 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 below $ 74 000.
A further renewal of the program is not included in Biden’s $ 1.9 billion US bailout plan, ”What he hopes Congress will succeed in the coming weeks.