More than 35,000 businesses, contractors and some sole traders in Missouri have received approval for loans under a multi-billion dollar federal program aimed at helping smaller firms during the Covid-19 emergency.
Loans worth $6.4 billion were approved for just over 34,000 Missouri businesses as of early this week, according to the Small Business Administration. However, those figures will have increased as the almost $349 billion set aside by Congress was allocated by Thursday evening.
Congressional leaders are discussing increased funding for the program, but no deal had been reached by midday on Friday.
Construction firms will receive the most money nationally, $33 billion, following by professional, scientific and technical companies, manufacturing, health care and social assistance, accommodation and food, and retail, all over $20 billion.
Under the CARES Act, the Paycheck Protection Program (PPP) provides small businesses, those with less than 500 employees, with funds to pay up to eight weeks of payroll costs, including benefits. The loans will be 100 percent forgiven if employers use them to cover eligible expenses.
The SBA reported Tuesday that it had approved loans worth $247 billion to just over one million businesses nationwide. Under the act, banks must move the money to those approved within five days.
Texas companies will receive the most money, $21.7 billion, followed by California, just over $20 billion, Florida, $12.6 billion, and Illinois, $12.5 billion.
Seventy percent of the loans were for under $150,000, which accounted for 15 percent of the total money, the SBA reported, which also revealed that the largest amount of money was spent on loans of between $350,000-$1 million.
Over 99 percent of America’s 28.7 million firms are small businesses, with the majority, 89 percent, employing fewer than 20 people, the Annual Survey of Entrepreneurs has reported. Nearly 40 percent of all enterprises have under $100,000 in revenue, according to a study by JP Morgan Chase
But one St. Louis business development organization, which partners with the SBA to help smaller companies, had not heard last weekend of any that had received funds since the signing of the CARES Act in late March. But the organization did expect some to receive funds this week.
Lynette Watson, regional director in St. Louis of the Small Business Development Center (SBDC), said some have been approved and, under the legislation, banks then have five days to release the funds. SBDCs provide technical help and coaching to small businesses and aspiring entrepreneurs.
"Business owners are frustrated and angry," Watson told the St. Louis Record. "People are getting angry but you are taking an agency that was miniscule and growing it to three times its size and trying to do that in three weeks."
Watson did note that sole proprietors were only able to begin the application last Friday, April 10.