Small business loan program expands with PayPal, Square, Intuit - ABC News

Small business loan program expands with PayPal, Square, Intuit - ABC News

Small business loan program expands with PayPal, Square, Intuit - ABC News

Posted: 14 Apr 2020 12:00 AM PDT

ABC News Corona Virus Government. Response

A number of fintech companies can participate in the Paycheck Protection Program

A number of fintech companies -- many of them household names -- can now participate in the federal government's Paycheck Protection Program, and that is good news for scores of small business owners who might not have existing relationships with larger banks which have prioritized that in accepting applications so far.

Square, PayPal and Intuit are among a group of non-traditional lenders the Small Business Administration has now approved to participate in this $350 billion program which provides government-backed, low interest, forgivable loans to rescue small businesses crushed by the novel coronavirus' economic impact.

This comes as the PPP is nearly out of cash and is still plagued by problems, including some that still exist with SBA's online loan application portal used by all lenders known as E-Tran, which was down on Monday, according to a banking industry source. The SBA denied this to ABC News on Monday, with spokeswoman Jen Kelly saying, "E-Tran is running and doing billions of dollars in loans."

White House economic adviser Larry Kudlow, over the weekend, said in a Fox interview that the program was estimated to run dry by Friday, and Congress is still squabbling over funding.

It's unclear what the influx of lenders and demand on an already-over-burdened system might mean; still, demand for the program is high, according to these non-traditional lenders which lobbied Congress to be included in the PPP, and many intend to help the little guy, already counted among their clientele.

PayPal, which serves more than 10 million small businesses in the U.S., has started accepting applications, and according to spokesman Joe Gallo, has already funded some loans, though it would not disclose further details.

The company is prioritizing existing customers, though not ruling out opening the door to others.

"At this time we are focused on our more than 10 million U.S. small business customers. We continue to monitor the situation and update as needed," Gallo told ABC News.

Gallo also said that his company's participation in the program would mean that much-needed aid would flow to underserved communities that he called "banking deserts" -- counties where banks have closed since the 2008 financial collapse.

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Square -- which has millions of sellers globally, with most in the U.S. -- plans to start taking applications this week, according to spokeswoman Katie Dally who told ABC News that the company sees this as a huge opportunity to help sole proprietors and independent small business owners.

Though the company will eventually be open to all small businesses, Square has planned a "rolled out application launch," prioritizing existing customers who can easily auto-populate forms, like payroll for those who use Square Payroll.

"We can easily port data for those people, so it will go much faster," Dally said. "We do expect high demand. We've been working with our seller base since April 3."

Both Square and PayPal partner work in partnership with banks, Celtic Bank and WebBank, respectively.

Intuit said its Quick Books Capital program would be able to "simplify, automate and expedite the PPP application and funding process."

"We are focused on getting help to customers as quickly as possible as they navigate this unprecedented and challenging time," said Alex Chriss, EVP and GM of QuickBooks.

Like Square and PayPal, Intuit said it would prioritize existing customers, as well.

"PPP federal relief processing will initially be available for a subset of QuickBooks Online Payroll customers who will be able to begin applying as early as next week," the company announced on Friday.

"Validation of payroll information is necessary to complete the PPP application. For QuickBooks Payroll customers, the customers' data is already in the QuickBooks system. As a result, we are well positioned to help expedite the loan application process for this group. One in 12 American workers are paid through our payroll systems, which makes this an impactful place to start," said Luke Voiles, VP and Business Leader of QuickBooks Capital.

As of this weekend, Kudlow said PPP had seen some 661,000 loans approved totaling $168 billion. Neither the SBA nor the Treasury Department would say how much money had been disbursed.

"Those are enormous numbers. That's one reason, by the way, our estimates are we're going to run out of money for the small business thing April 17th," he said. "That's why we would like the Congress to help us with an additional $250 billion."

There is little to no disagreement over whether or not to increase PPP by that amount, the question remains, can Democrats and Republicans come to an agreement on whether to fund other programs and urgent needs now or save those for the next, all-but-certain stimulus package.

ABC News' Sarah Kolinovsky contributed to this report.

What to know about coronavirus:

PayPal Empowerment Grants Continue to Help Small Business Owners - Chicago Defender

Posted: 11 Sep 2020 12:00 AM PDT

PayPal Empowerment Grants have helped many small business owners in Chicago sustain themselves amid the COVID-19 pandemic.  In June of this year, PayPal announced a $530 million commitment to support small Black-owned businesses and communities across the country, who suffered setbacks due to COVID-19. Since the announcement, PayPal has delivered $10 million in grants to over 1,100 businesses, with Chicago ranking within the top five cities that have requested and received funds.

Paypal Small Business Chicago DefenderOne of the recipients, Desiree (Desi) O'Kelley-Smith, small business owner of Desi's Full Service Salon, located on the city's south side, said that after 33 years in business, was forced to shut down for three months due to COVID abruptly. While closed, Desi researched grants and other funding sources to help with the cost of rent and continue paying her staff but had little luck. She said, "The city had funding programs, but unfortunately, I was not selected for any of them. And as far as federal funding, mainly the Paycheck Protection Plan (PPP), all of that money was sent out in the first round to the larger businesses." In the next round of PPP Loans, Desi received some funds, but it still was not enough, leaving her to continue searching for more.

After coming across information for the PayPal Empowerment Grant for small business owners, Desi decided to apply, and soon after, she learned that she was awarded $7,500. Since receiving the grant, Desi has purchased new salon items, paid her rent and other bills, and re-opened her salon in June. She describes her overall experience over the past six months as "challenging," saying, "I was able to find some funds, but most of it had to be paid back. The PayPal grant was a great help."

Desi also says that since opening back up, the business has been relatively slow due to not taking as many clients and having to change the way that she and her staff service them. She also points out that she has had a decrease in clientele and staff because many of them have reservations about coming out of the house. "We do everything we can to keep people safe. So we're taking temperatures, encouraging people to wash their hands, and have hand sanitizer throughout the salon", she said.

Many businesses, like Desi's, share the same experience. Lauren Spencer, the owner of B&B Candy & Ice Cream, is also located on the city's south side. After being in business for four years, Lauren faced the sad reality that she would have to close. Due to her being a non-essential business, she had to cut hours once opening back up, thus affecting her bottom line. Lauren also shared that she had to let some of her employees go to stay afloat. Because of this, wait times increased, causing customers to grow impatient and leave shortly after arriving.

Paypal small Business Chicago DefenderDuring the shut-down, many of the food items at B&B Candy & Ice Cream went bad, causing Lauren to have to discard them. Since receiving the PayPal Empowerment Grant, she says that she could purchase a new storage container to better store inventory and stock up in the event of another shut-down. She says that it also allowed her to re-hire staff members that were previously let go and bring on a few more new faces.

Lauren says that she heard about the PayPal grant program from Twitter and discovered that she was one of the recipients a month after applying. She says to any small business searching for funding after being shut-down: "There are things out there that can help us. So don't get discouraged if you don't find something immediately. Throughout this PayPal process, I was denied from so many other grants, and it was a relief to finally find out that I was selected to be one of their recipients."

For more information on Desi's Full Service Salon, click here, and for information on B&B Candy & Ice Cream, click here.

Contributing Writer, Racquel Coral is a lifestyle writer based in Chicago. Find her on social media @withloveracquel.


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