80% of Small Business are Still Waiting for Financial Assistance Loans

the staff of the Ridgewood blog

Ridgewood NJ, The NFIB Research Center released a survey today on the small business loan programs. Small business owners were asked about the Paycheck Protection Program and the Economic Injury Disaster Loan on April 17, the day after the programs ran out of money. About 20% of submitted applications have been fully processed with funds deposited in the borrower’s account, but 80% of respondents said they are still waiting, and many do not know where they are in the application process.

Most small business owners believe it will take beyond 2020 to recover from the economic impact of COVID-19, with only one-third of small business owners believing their community will get back to a normal level of economic activity by the end of the year. A quarter of owners believe it will not be until 2022 or later before the economy returns to normal.

“Small businesses were prepared and ready to apply for these programs, the only financial support options for most, and it is very frustrating that the majority of these true small businesses haven’t received their loan yet,” said Holly Wade, NFIB Director of Research & Policy Analysis. “Small businesses make up nearly half of the economy and it’s crucial that their doors stay open.”

“It is a difficult conversation when a small business owner calls saying their loan wasn’t accepted merely because the funds were depleted and their application wasn’t even processed.” said Eileen Kean, state director of NFIB in New Jersey. “Right now, without more federal funding, it isn’t worth speculating about economic recovery because it will be impossible. Congress must vote to add funds to the program as soon as possible because it’s a question of survival.”

Key Findings of the Survey Include:

About three-quarters of small business owners (almost all employer businesses) have submitted an application for a PPP loan as of April 17.

• About one-in-five (20%) of submitted applications have been fully processed with funds deposited in the borrower’s account.
• Nearly 80% are still waiting, many not knowing where they are in the process.

About 40% of small business owners successfully submitted an application for an EIDL through the SBA website.

• Among those who submitted an application, most (77%) requested the emergency grant of up to $10,000.
• Of those who requested the EIDL emergency grant, about 10% have received the funds.
• Essentially, all of the EIDL applicants (99%) have yet to receive the loan.

Most small business owners believe it will take beyond 2020 and into the years following to get back to normal economic activity.

• About one-third of small business owners believe their community will be back to a normal level of economic activity by the end of the year.
• Just under 40% believe more normal levels of economic activity will return in 2021.
• A quarter of owners believe it will not be until 2022 or later before the economy returns to normal.

The full survey is available here.