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The Paycheck Protection Program—an emergency lending facility for small businesses established by the $2.2 trillion CARES Act—has been troubled from the start, including a chaotic launch, computer glitches and backlash over public companies that received loans.
Under the program, companies with fewer than 500 workers can apply for loans of up to $10 million at 1% interest in order to cover two months of payroll and overhead expenses. So long as borrowers retain workers and don’t cut wages, the government will forgive most or all of the loan. Meanwhile, a new proposal by House Democrats to replace the PPP is gaining steam.
Here are five numbers that sum up the embattled lending program.
That’s how much Congress has allocated for the PPP through two separate rounds of funding.
That’s how long it took for the first round of the PPP to run out of money. During that time, the Small Business Administration guaranteed 1.6 million loans worth $342 billion. After the funds ran dry, lawmakers scrambled to put together a second piece of legislation to replenish the PPP.
That’s how much has been lent out under the second round of the program as of May 7, out of a possible $310 billion. That means that less than half of the funds are left. That money translates to almost 2.5 million loans with an average size of $74,000.
That’s how many unemployment claims analysts at UBS believe the PPP prevented over a span of 3 weeks. “We find that at the state level, PPP loans are negatively correlated with jobless claims,” the researchers wrote. They are also predicting that over the next few weeks, the second round of the PPP has the potential to prevent another 1.5 million claims.
That’s how much a proposal from Democrats in the House of Representatives—intended to replace the PPP—might cost, as reported by the Washington Post. The plan, spearheaded by Rep. Pramila Jayapal (D-Wash) would offer grants to pay 100% of worker salaries and benefits during the health emergency and would be retroactive to March 1. The net cost projection figure comes from an analysis by Moody’s chief economist Mark Zandi, and was provided to the Post by Rep. Jayapal’s office.