The U.S. Small Business Administration, in consultation with the U.S. Treasury Department, has announced it is setting aside $10 billion of Round 2 funding for the Paycheck Protection Program (PPP) to be lent exclusively by Community Development Financial Institutions (CDFIs). CDFIs work to expand economic opportunity in low-income communities by providing access to financial products and services for local residents and businesses. These dedicated funds will further ensure the PPP reaches all communities in need of relief during the COVID-19 pandemic, the SBA said.
“There are six CDFIs located in Utah to help small businesses access these PPP funds. They are ready and can help businesses start the process,” SBA Utah District director Marla Trollan said. The CDFIs in Utah are Goldenwest Credit Union, Provo Postal Credit Union, Community Development Fund of Utah, Rocky Mountain Community Reinvestment Corp., Salt Lake Neighborhood Housing Services Inc. and Utah Microenterprise Loan Fund.
“The forgivable loan program, PPP, is dedicated to providing emergency capital to sustain our nation’s small businesses, the drivers of our economy, and retain their employees,” said SBA administrator Jovita Carranza. “CDFIs provide critically important capital and technical assistance to small businesses from rural, minority and other underserved communities, especially during this economically challenging time.”
As of May 23, CDFIs had approved more than $7 billion ($3.2 billion in Round 2) in PPP loans. According to the SBA, the additional $6.8 billion will ensure that entrepreneurs and small-business owners in all communities have easy access to the financial system and that they receive much-needed capital to maintain their workforces.
The Paycheck Protection Program was created by the Coronavirus, Aid, Relief and Economic Security Act (CARES Act) and provides forgivable loans to small businesses affected by the COVID-19 pandemic to keep their employees on the payroll. Through late May, more than 4.4 million loans had been approved for over $510 billion for small businesses across America.