Welcome to the Small Business Rundown. Each day, we bring you stories that impact small business owners and their workforce.
Small Business News Highlights for September 22:
- Fed unlikely to restructure lending program to include small businesses
- White House still wants to play ball on additional stimulus package
- SBOs urge Congress to take up stand alone bill to support small businesses
Fed unlikely to restructure lending program for SMBs
“Extending credit in those small quantities would require a facility built from the ground that would be quite different than Main Street.”
Congressional officials have urged the Fed to change the Main Street Lending Program requirements to do more to support small businesses. Unfortunately, says Fed Chairman Jerome Powell, that’s not going to happen.
According to Powell, lowering the minimum threshold amount for loans from $250,000 to $100,000 would require the Fed to start from scratch and create a whole new program. Furthermore, said Powell, there is very little demand for loans under $1 million to begin and indicated that the Paycheck Protection Program through the Small Business Administration is better suited to handle these sorts of loans.
White House ready to resume stimulus negotiations
“We continue to try to work with Congress on a bipartisan basis to pass a Phase IV relief package. I believe a targeted package is still needed, and the administration is ready to reach a bipartisan agreement.”
Treasury Secretary Steve Mnuchin testified before Congress today, signaling a willingness on the part of the White House to resume negotiations for a new round of stimulus spending. Speaker of the House Nancy Pelosi has also stated that she has not given up hope on additional economic aid being passed before the November 3 election.
If the administration and Congress can agree on a plan, the IRS has said that it will be able to process and send out direct payments to Americans much faster this time around.
SBOs urge Congress to take up stand alone bill to support small businesses
“Unless Congress provides additional relief this month, business failures in the next several months will skyrocket as it will be impossible for additional measures to come online until well after the election or perhaps even into early 2021.”
The Small Business Roundtable has written a letter urging Congress to pass stand alone legislation to help the country’s 30 million small businesses.
Specifically, the letter asks lawmakers to provide more funds through the Paycheck Protection Program (PPP), to expedite loan forgiveness and to eliminate the caps and increase funding for the Economic Injury Disaster Loan Program.
A recent study by Yelp found that 60% of businesses that closed in March will stay closed permanently.