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The first round of the Paycheck Protection Program saw more than 18,000 loans approved for Connecticut small businesses before funds ran out on April 16.
Nationwide more than 1.6 million small businesses were approved for loans through 12 p.m. on Thursday. The program opened on April 3, a week after it was established through the CARES Act. Lenders reported receiving an overwhelming number of applications for the program, which was supposed to last through June 30. Funds were depleted Thursday morning, and the U.S. Small Business Administration suspended the program.
Congress is currently finalizing a deal to fund another round of PPP loans.
The 18,435 PPP loans received by Connecticut small businesses totaled about $4.15 billion.
The program was created to help small businesses and nonprofit organizations keep employees on their payroll during the coronavirus pandemic. Based on 2019 data, the first round of PPP loan approvals involved less than 10 percent of Connecticut small businesses. According to the SBA’s 2019 state profile, Connecticut had more than 347,000 small businesses in 2019, and the 750,000 employees at these businesses in 2019 made up about 49 percent of the state’s workforce.
The average loan size nationally was $206,000, though 74 percent of the loans were for $150,000 or less.
Almost 5,000 lenders nationwide participated in the program. SBA Administrator Jovita Carranza and Treasury Secretary Steven Mnuchin said in a joint statement last week that the program included significant lending by community banks and credit unions.
“Nearly 20 percent of the amount approved was processed by lenders with less than $1 billion in assets, and approximately 60 percent of the loans were approved by banks with $10 billion of assets or less,” Carranza and Mnuchin said in the statement. “No lender accounted for more than 5 percent of the total dollar amount of the program.”
Funding has lapsed for another SBA program intended to help small businesses experiencing financial difficulties related to the coronavirus. The SBA announced last week that it was no longer accepting Economic Injury Disaster Loan applications.
