Displaying items by tag: EIDL grants

This is likely to be the hardest weekend ever for millions of small business owners around the country. The SBA ran out of money on Thursday after just 1.6 million business had loans been “approved”—the vast majority of which have not been paid, according to COVID Loan Tracker. There are 30 million small businesses in this country. Even discounting for shell companies, that means tens of millions of small businesses got nothing from the program and are now facing doom. Forbes estimates the program only funded 5% of small businesses in the country.

PLEASE HELP SMALL BUSINESSES BY FILLING OUT OUT THE COVID LOAN TRACKER SURVEY.

Congress needs to urgently refund the program to help these businesses, but it is also worth noting that there were vast discrepancies in those who received PPP money. “Those who had pre-existing credit relationships with banks did much better”, says Duncan MacDonald-Korth, cofounder of COVID Loan Tracker. “And ‘big’ small businesses are much more likely to have those credit relationships”, he continued. Accordingly, COVID Loan Tracker found that over 81% of those who received PPP had pre-existing lending relationships with small banks! That means the millions of small businesses who fund themselves by making more money than they spend were boxed out of this program.

COVID Loan Tracker was started by small business owners Duncan and Rita MacDonald-Korth to help their fellow small business owners understand where PPP and EIDL money is flowing. We are empowering the business community and journalists with the data they need to keep the government accountable.

Small business owners around the country are scratching their heads amidst their broader panic about the news that the Paycheck Protection Program funding has run out. According to COVID Loan Tracker, which has tracked the applications of 15,000 small businesses totaling over $5 bn in PPP loans, only around 6% of companies have actually had loans deposited in their accounts. Many small businesses are wondering “where is the money?”, says COVID Loan Tracker co-founder Rita MacDonald-Korth.

PLEASE HELP SMALL BUSINESS OWNERS BY FILLING OUT THE SURVEY

COVID Loan Tracker was started by small business owners Duncan and Rita MacDonald-Korth to help their fellow small business owners understand when PPP and EIDL advance money starts flowing. The site works by crowdsourcing knowledge on applications and loan disbursements. Our goal is to help the small business community and empower journalists with the data they need to keep the government accountable.

The two founders of the site report that they have had extensive communication with banks and lenders over the last ten days and the huge difference between “approved” loans and disbursed loans can be accounted for by the behavior of borrowers, the banks, and the SBA.

“The speed with which the PPP program was designed led to inherent flaws and misaligned interests that have caused huge bottlenecks in deploying funds to small businesses”, says Duncan MacDonald-Korth. According to MacDonald-Korth, the problem is that the poor initial guidelines for banks and the “first come first serve” nature of the program, made borrowers apply to many banks/lenders at once. Because of that “there was double to triple the volume of applications as actual businesses applying”. This caused an apparent cascade of issues.

Firstly, it compelled banks to submit applications to the SBA for approval before they were actually complete. Because banks get paid a 1-5% fee for processing the loan, they want to make sure they process it and not a competitor. Accordingly, with so many duplicate applications, it made sense for the banks to urgently submit applications to the SBA—in order to win approval versus other lenders—even if all the paperwork was not in order. The SBA, in turn, had to make sure it was not approving duplicate applications, so it had double check each application flowing in, slowing down the process. All of this leads to the situation we have today—money entirely exhausted, but the vast majority of it not paid out because banks are still getting the proper paperwork from borrowers.

PLEASE HELP KEEP THE DATA FLOWING

It is now official, the Paycheck Protection Program has exhausted its entire $349 bn. The announcement came yesterday that all the money in the program has been “approved”. However, that announcement left small business owners in confusion, as data shows very little money has arrived. According to COVID Loan Tracker, less than 6% of small business owners say that they have actually received money.

COVID Loan Tracker was started by small business owners Duncan and Rita MacDonald-Korth to help their fellow small business owners understand when PPP and EIDL advance money starts flowing. The site works by crowdsourcing knowledge on applications and loan disbursements. Our goal is to help the small business community and empower journalists with the data they need to keep the government accountable.

PLEASE HELP SMALL BUSINESS OWNERS BY FILLING OUT THE FORM

Small business owners are having trouble reconciling the difference they see between the SBA’s numbers and the lack of money they see in their accounts. The SBA has done little to clear up the confusion, as they have not made actual loan disbursement data public. “Where is the money? That is what all small business owners are asking us. We are getting thousands of those emails a day.”, says Rita MacDonald-Korth, co-founder of COVID Loan Tracker.

HELP COVID LOAN TRACKER KEEP THE DATA FLOWING

Earlier this week, the Small Business Administration released aggregate details about the amount of loans “approved” in each sector and each state for the Paycheck Protection Program. However, the document did very little to help business owners understand where their money is, says COVID Loan Tracker.

“Approved” has become a very vague term as it concerns the SBA. COVID Loan Tracker says it has received hundreds of emails from small business owners who say that they have received notices of “approval” but have then waited several days before receiving money, or still have not received it.

COVID Loan Tracker was started by small business owners Duncan and Rita MacDonald-Korth to help their fellow small business owners understand when PPP and EIDL advance money starts flowing. The site works by crowdsourcing knowledge on applications and loan disbursements. Our goal is to help the small business community and empower journalists with the data they need to keep the government accountable.

PLEASE HELP SMALL BUSINESS OWNERS BY FILLING OUT THE FORM

While the release of the data by the SBA does help gain insight into which sectors and states will ultimately receive money, the agency has been reticent to release the numbers of actual loan disbursement (i.e. money actually paid out). This figure would be much more illustrative of how the PPP loan program is proceeding.

For instance, the document does not lend any clarity to the percent of applications that have been paid. According to COVID Loan Tracker, that figure stands at just 5%, a far cry from the ~70% the SBA says has been “approved”. “Where is the money”, says one of COVID Loan Tracker’s founders, Duncan MacDonald-Korth.

https://www.covidloantracker.com/

COVID Loan Tracker was started by small business owners Duncan and Rita MacDonald-Korth to help their fellow small business owners understand when PPP and EIDL advance money starts flowing. The site works by crowdsourcing knowledge on applications and loan disbursements. Our goal is to help the small business community and empower journalists with the data they need to keep the government accountable.

PLEASE HELP SMALL BUSINESS OWNERS BY FILLING OUT THE FORM

Today the site is announcing an exciting new development—all stats will be available in real-time! Data on successful PPP loans and EIDL advances, as well as on all applications, will be live and in real-time on COVID Loan Tracker. This mean small business owners and the press can get live and updated information 24 hours per day.

SPREAD THE WORD!

Additionally, the new automated reporting will feature data visualization tools which help to understand how and where money is flowing, such as heat mapping states where the most money is flowing.