In a television interview today, Mnuchin assures small businesses that program will not run out of money and all eligible businesses will be funded.
U.S. Treasury Secretary Steven Mnuchin today sought to assure small business operators in a television interview that the SBA Paycheck Protection Loan program for small businesses will have all necessary funding for eligible businesses. Mnuchin had announced on Twitter yesterday that he was working with Congress to secure an additional $250 billion in funding to support small business loans under the Paycheck Protection Program that was rolled out last Friday.
The program, administered by the SBA and available through banks, was authorized to provide $349 billion on a first come, first served basis leading to a rush to apply that has created problems for lenders participating in the program.
Also, many lenders are requiring documentation on payrolls for the full year period through the end of March, so small businesses who use third parties such as accounting firms or payroll services may not have the necessary documentation prepared yet given the close timing to the end of the March.
At the direction of President @realDonaldTrump, I've spoken with @SenateMajLdr, @SenSchumer, @SpeakerPelosi, and @GOPLeader to secure an additional $250 billion for the #PPPLoan program to make sure small businesses get the money they need!
— Steven Mnuchin (@stevenmnuchin1) April 7, 2020
In an interview on CNBC today, embedded below, Mnuchin said the additional funds are receiving broad-based support in Congress and he sought to assure small businesses that the program will have the funds for every small business that is eligible.
“I want to assure all small businesses out there we will not run out of money. The President has asked us to go back to Congress and we hope they pass this tomorrow and Friday. And, we want to assure everybody if you don’t get a loan this week, you’ll get a loan next week or the following week. The money will be there,” said Mnuchin in the interview.
Loans under the Paycheck Protection Act can be 2.5 times the borrower’s average monthly payroll costs, and they cannot exceed $10 million. The interest rate for Paycheck Protection loans are set at 1% and loans mature after two years. The SBA will forgive loans if all employees are kept on the payroll for eight weeks and the money is used for payroll, rent, mortgage interest, or utilities.