Chris Hurn, founder of Fountainhead Commercial Capital, has received 7,400 small business loan requests in the past two weeks, more than his business has handled in its five years of existence.
The Lake Mary, Florida-based non-bank lender is just one of thousands of financial institutions across the country preparing to dole out $349 billion in government-backed loans and grants starting Friday, just one week after they were created as part of the $2.3 trillion fiscal stimulus bill.
The brand-new Paycheck Protection Program, aimed at keeping large swaths of Main Street afloat as the coronavirus pandemic spreads, enlists the US Treasury, the Small Business Administration (SBA), and many of the country’s financial institutions in an effort that economists say is crucial to keeping the US from plunging into a deep downturn.
It offers government-backed, low-interest, forgivable loans, to businesses that keep employees on their payroll despite the shutdowns, part of the Trump administration’s push to keep Americans off of unemployment benefits.
It also throws the nearly 67-year-old SBA into a higher profile role than ever before, one that some lenders worry it could struggle to fill.
The rescue package amounts to a giant expansion of activity for the 3,300 people who work at SBA. The $349 billion in loans Treasury Secretary Steven Mnuchin is hoping to move quickly through that program is 12 times the $28.1 billion in loans the SBA approved in all of fiscal 2019.