SBA Paycheck Protection Program Loans

SBA Report Suggests Paycheck Protection Program Will Be Out of Money This Week

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The Small Business Administration (SBA) provided an update on the Paycheck Protection Program (PPP) lending program.

In the CARES Act passed by Congress to help with the current coronavirus (COVID-19) crisis economic meltdown, lawmakers allocated $350 billion towards the PPP loan program.

Yesterday, the SBA issued an interim report showing about $246 billion in loans have already been approved as of April 13, leaving about $100 billion available eight days after the program went live.

Simple math using daily averaging suggests that absent swift intervention from Congress, the PPP loan program will be out of money this week.

Is It Too Late to Apply For The Paycheck Protection Program?

Yes and No. It may be too late to get a loan approved under the current funding through the CARES Act.

By the time the loan application goes through the initial bank screening and is transmitted to the SBA, it would appear the financial resources for PPP will be depleted.

On the “good news” side, there is slow progress in Congress to get another $250 billion approved for the PPP loan program.

Unfortunately, both sides of the aisle are bickering about what else should be in this new stimulus package in addition to PPP loan funding.

Assuming lawmakers can agree on something this week, there is a chance more funding could become available next week.

Therefore, small business owners that have not applied for a PPP loan yet should not stop and give up.

Instead, business owners should get the required documents together, seek out a lender, and get the PPP application into the system.

Despite all the reported problems with the PPP loan application process, the SBA data indicates banks have been receiving SBA loan approvals relatively quickly.

Even if the program runs out of money, the sooner the application is in the queue, the sooner it can be funded when fresh money is made available by Congress.

SBA Paycheck Protection Program to Date by The Numbers

In the update, the SBA also provided some interesting data that reveals the top five states with the most approved PPP loans are Texas, California, Florida, Illinois, and New York.

SBA Paycheck Protection Program by States

StateApproved LoansApproved Dollars
AK2,703$602,911,645
AL19,244$3,819,600,518
AR14,803$2,166,563,254
AS1$389,500
AZ10,898$3,524,770,207
CA54,922$20,853,495,045
CO28,469$5,830,781,842
CT11,930$2,923,132,220
DC1,663$791,004,872
DE1,974$590,422,870
FL52,021$12,656,107,018
GA29,423$6,725,718,213
GU238$53,659,254
HI8,426$1,626,051,108
IA22,295$3,748,993,223
ID88,46$1,399,191,164
IL44,453$12,503,648,850
IN23,583$5,986,077,384
KS19,915$3,729,110,056
KY17,216$3,336,402,794
LA17,097$3,745,462,888
MA27,315$7,073,245,593
MD11,937$3,756,206,258
ME10,889$1,710,424,025
MI24,974$7,321,573,738
MN33,819$7,633,395,870
MO34,088$6,433,368,771
MP29$7,540,546
MS14,209$1,921,783,598
MT10,372$1,293,105,048
NC23,786$5,729,549,254
ND8,232$1,386,597,176
NE18,565$2,727,637,044
NH7,113$1,520,212,834
NJ17,187$5,897,533,934
NM5,365$1,103,753,677
NV4,209$1,255,172,600
NY40,975$11,737,950,918
OH38,016$10,368,882,724
OK26,451$4,009,914,991
OR9,508$2,427,776,445
PA36,604$9,910,549,957
PR1,001$319,308,946
RI4,110$875,591,033
SC14,273$2,756,101,029
SD7,986$1,156,576,164
TN19,074$4,742,194,968
TX88,434$21,776,306,479
UT12,914$2,617,066,864
VA26,880$6,615,120,527
VI68$13,116,530
VT4,886$853,707,598
WA18,906$4,928,845,742
WI31,702$7,288,143,288
WV5,211$1,054,712,809
Total Approved1,028,872$246,836,460,903
As of 4/13/2020

Furthermore, over 70 percent of the loans are under $150,000 with the average loan amount being $239,000. Almost 2 percent of all loans are for more than $2 million, making up nearly 30 percent of all loans funded.

The SBA also provided a breakdown by industry of small businesses that received PPP loans. Construction leads in Dollars, while professional, scientific, and technical services lead in the number of PPP loans approved. Restaurants and retailers came in 4th and 5th respectively in both categories.

SBA Paycheck Protection Program by Industry

NAICS Subsector DescriptionApproved LoansApproved Dollars% of Amount
Construction114,838$33,994,993,10313.73%
Professional, Scientific, and Technical Services126,372$30,747,730,76612.26%
Manufacturing72,728$30,324,381,64212.25%
Health Care and Social Assistance114,736$27,707,715,75511.77%
Accommodation and Food Services108,179$22,729,710,7659.18%
Retail Trade105,796$21,205,961,5888.77%
Wholesale Trade42,680$14,340,947,7245.79%
Other Services (except Public Administration)93,538$12,302,748,0494.97%
Administrative and Support and Waste Management and Remediation Services45,492$10,620,220,8304.29%
Real Estate and Rental and Leasing48,940$7,963,204,1903.22%
Transportation and Warehousing28,181$7,824,422,8443.16%
Finance and Insurance36,714$5,780,025,6632.33%
Educational Services15,213$5,664,150,3532.29%
Information13,693$4,449,853,3241.18%
Arts, Entertainment, and Recreation25,785$3,690,034,0851.49%
Mining8,133$3,010,017,1341.22%
Agriculture, Forestry, Fishing and Hunting27,428$2,973,951,1171.20%
Management of Companies and Enterprises2,278$887,589,2990.36%
Public Administration3,058$824,899,8590.33%
Utilities2,056$701,335,0310.28%
As of 4/13/2020

While it is difficult to extract too much detail from macro data, there does seem to be a slight pattern.

Industries that typically have disciplined daily accounting practices are leading the way in PPP loan approvals. Construction, manufacturing, professional and health care related services usually fall into that category.

On the flip side, industries hit hardest by the Stay at Home orders such as restaurants and retailers, seem to be lagging.

The most likely reason is that many small businesses in those two categories don’t keep the most up-to-date books and need a little time to catch up.

This is also the group that really needs to accelerate to bring their financials up-to-date so they can be ready for the next funding wave. PPP loans are clearly extremely popular and it’s becoming increasingly questionable if there will be a third round of funding.

Each Congressional stimulus package seems to take longer as Democrats and Republicans fight over what should be in the legislation.

The first $2.2 trillion stimulus program was relatively quick and easy by Washington standards and it doesn’t appear lawmakers feel the same urgency for future stimulus programs.

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