US winds down small business aid program that gave $800 bn
Jun 01, 2021 - 11:35 PM
WASHINGTON — The US government on Tuesday closed the books on the Paycheck Protection Program (PPP) that extended a nearly $800-billion lifeline to small businesses to keep them afloat amid the Covid-19 pandemic.
Created by the CARES Act rescue package in March 2020, the PPP emergency aid measure offered low-cost loans to small businesses which did not have to be repaid if certain conditions were met.
In a statement announcing its May 31 closure, Small Business Administration chief Isabella Casillas Guzman said the program provided $798 billion to 8.5 million small firms and nonprofits across the country.
“I’ve heard story after story from small business owners across the country about how PPP funds helped them keep the lights on, pay their employees — and gave them hope,” Guzman said.
The program was part of Washington’s response to the mass unemployment and business disruptions caused by the pandemic, which also included cash payments to individuals and expanded unemployment benefits, in three massive relief measures.
However, the PPP faced criticism early on after its initial funds were quickly exhausted amid reports large businesses, including major restaurant chains, partook of the funds, though some later returned the money.
It also was dogged by fraud, with federal officials over the past year announcing hundreds of charges involving half a billion dollars allegedly bilked from the PPP and other pandemic relief programs.