US small businesses seek USD5.4 billion in virus relief loans

WASHINGTON (AFP) – Small and medium-size United States (US) businesses have applied for more than USD5.4 billion in government-backed loans as a key pillar of the country’s coronavirus relief plan took effect, the Trump administration said.

Jovita Carranza, who heads the federal Small Business Administration, said late last Friday on Twitter that 17,503 companies – those with 500 or fewer employees – had filed applications through local banks for loans totalling more than USD5.4 billion.

Last Friday was the first day the companies were able to apply for the money, intended in large part to help them pay employees’ salaries. The loans, which could eventually total USD350 billion, constitute a central part of the USD2.2 trillion coronavirus relief plan adopted by Congress and then signed into law by US President Donald Trump on March 27. “I will immediately ask Congress for more money to support small businesses… if the allocated money runs out,” Trump tweeted last Saturday.

But things were “so far, way ahead of schedule,” he said, adding that Bank of America and community banks “are rocking!”

Last Friday, most applications were submitted to local banks. Some of the biggest US banks said they had encountered difficulties with administrative procedures, although Bank of America reported that it had processed tens of thousands of applications by the end of the day.

Treasury Secretary Steven Mnuchin told the Fox Business Network that “our expectation is starting next week” all big banks would be ready.