America relies on the small business that line the streets in all of its communities. More than 99% of the businesses in the United States employ fewer than 500 people, and historically, these small firms have created two-thirds of America’s net new jobs.footnote1 For these businesses and the communities they call home, navigating the impacts of the coronavirus is not only critical to their future, it’s paramount to the nation’s recovery. The federal Coronavirus Aid, Relief, and Economic Support (CARES) Act, adopted in March, included the Paycheck Protection Program (PPP) for exactly this reason, providing up to $659 billion in loans to small businesses so they could continue to pay their employees and certain operating expenses.
As part of its efforts to help small businesses during this time, Bank of America was the first to accept PPP applications and as of May 15 has received approval from the Small Business Administration (SBA) for 322,000 loans to small business clients for more than $26 billion in relief. So far, 98% of the applications are for companies with fewer than 100 employees and 81% are for companies with 10 or fewer employees. Nearly a quarter of the applications were from companies from low-to-moderate income neighborhoods.
“The payments are going exactly where they were supposed to go: to very small businesses in big numbers across the country,” says Brian Moynihan, the Chief Executive Officer of Bank of America.footnote2 The average loan size so far is $80,000.