Biden tweaks PPP loan rules to prioritize smallest businesses


The Biden administration is stepping in after Paycheck Protection Program loans went to some not-so-small businesses the first time around.
Compared to the first round issued last year, the latest round of pandemic relief loans have gone to far more very small businesses, businesses in rural areas, and minority-owned businesses. But the Biden administration is still implementing reforms to ensure the loans keep going to businesses with fewer than 20 employees and focus the reforms on people who need them most, it announced Monday.
After one month, 60 percent more of this round's PPP loans have gone to businesses with fewer than 10 employees this time around, and more than 30 percent more have gone to rural businesses. But starting Wednesday, the Biden administration will only allow businesses with fewer than 20 employees to apply for the loans for 14 days so lenders can prioritize those businesses. The changes also open up the loans to people with non-fraud felony convictions, in accordance with a bipartisan bill waiting for consideration in the Senate, and to non-citizen business owners.
Subscribe to The Week
Escape your echo chamber. Get the facts behind the news, plus analysis from multiple perspectives.

Sign up for The Week's Free Newsletters
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
From our morning news briefing to a weekly Good News Newsletter, get the best of The Week delivered directly to your inbox.
Biden also laid out modifications aimed at tackling "waste, fraud, and abuse across all federal programs" after billions of dollars of the last round of loans were flagged for potential fraud. Getting approved for a PPP loan is now "contingent on passing [Small Business Association] fraud checks, Treasury's Do Not Pay database, and public records," the White House said. Changes to the PPP loan application and further engagement with loan recipients are also aimed at better targeting who needs relief most.
Sign up for Today's Best Articles in your inbox
A free daily email with the biggest news stories of the day – and the best features from TheWeek.com
Kathryn is a graduate of Syracuse University, with degrees in magazine journalism and information technology, along with hours to earn another degree after working at SU's independent paper The Daily Orange. She's currently recovering from a horse addiction while living in New York City, and likes to share her extremely dry sense of humor on Twitter.
-
Crypto firm Coinbase hacked, faces SEC scrutiny
Speed Read The Securities and Exchange Commission has also been investigating whether Coinbase misstated its user numbers in past disclosures
-
Starbucks baristas strike over dress code
speed read The new uniform 'puts the burden on baristas' to buy new clothes, said a Starbucks Workers United union delegate
-
Warren Buffet announces surprise retirement
speed read At the annual meeting of Berkshire Hathaway, the billionaire investor named Vice Chairman Greg Abel his replacement
-
Trump calls Amazon's Bezos over tariff display
Speed Read The president was not happy with reports that Amazon would list the added cost from tariffs alongside product prices
-
Markets notch worst quarter in years as new tariffs loom
Speed Read The S&P 500 is on track for its worst month since 2022 as investors brace for Trump's tariffs
-
Tesla Cybertrucks recalled over dislodging panels
Speed Read Almost every Cybertruck in the US has been recalled over a stainless steel panel that could fall off
-
Crafting emporium Joann is going out of business
Speed Read The 82-year-old fabric and crafts store will be closing all 800 of its stores
-
Trump's China tariffs start after Canada, Mexico pauses
Speed Read The president paused his tariffs on America's closest neighbors after speaking to their leaders, but his import tax on Chinese goods has taken effect