Small Businesses are the lifeline of the American Economy. With over 30 million Small Businesses, that employ almost 60 million people which is almost 50% of the U.S workforce… it’s not hard to see why they are so important to our economy.
The Covid-19 Pandemic has been damaging to everyone, across the Globe and will have wide-ranging, long lasting impact on all of us. But one sector has been hit harder than any other, and that is the Small Businesses.
A lot are unable to operate. Those that are, are doing so in a limited capacity and even as the U.S begins to re-open in many states, it is under some strict guidelines. So most businesses will still be unable to operate at full capacity and their overall revenues will continue to be down.
The federal government’s response has been lackluster as far as providing relief for most Small Businesses. The marquee program designed to provide some relief, the Paycheck Protection Program (PPP) had a disastrous roll-out for Round 1. It was mired by slow response times, differing qualifications by each financial institution, minorities largely left out of the program, and large corporations including publicly traded companies who received massive amounts of the funding set aside specifically for Small Businesses.
This is something I recently spoke about on SiriusXM The UrbanView is Torin Ellis on his weekly show, CareerMix.
The 2nd round of PPP became a little better. We started to hear more stories of Small Businesses receiving the relief funding they desperately needed. Yet, it still has not been enough as we’re seeing more stories of businesses having to close doors.
People unsure of the exact terms of PPP, and more importantly not fully understanding if the loan will be forgiven… or if they’ll come out of one of the most difficult situations of our lifetimes, with more debt than they can handle.
This program has been a polarizing topic, covered by news stations nationwide and even popular moguls such as Mark Cuban, owner of the Dallas Mavericks and Shark on Shark Tank and Marcus Lemonis, owner of Camping World and reality TV personality on The Profit, who have taken it upon themselves to not only provide awareness but also resources and push for change.
One program we have not heard a lot about as of yet is the Main Street Lending Program, which is slated to start in a few weeks and is a $600 Billion lending program aimed at helping Main Street Businesses.
A Main Street Business for those that don’t know, is a community business that is typically a staple of your local community. Think, salons, barbershops, indie retailers, local auto shops etc etc. Some of which have been the hardest hit businesses throughout this pandemic. Setting aside $600 Billion for these businesses seems like a great idea, and one that would hopefully keep those staples of your community in place… but there’s a problem. The minimum loan amount a business owner could take for this program is $500,000.
No community business I know need, want, or could take on a $500,000 or more loan right now. Debt cannot and should never be the answer to more debt. That is not relief. it’s a one-way ticket to bankruptcy. This Main Street Lending Program, although it is not yet active… is already setup to be a failure.
The good news though is we have time. Time to call for change. That starts with awareness, which leads to action, and action leads to change. We must call on Congress to change the parameters of this program, lower the minimum loan amount to a more realistic amount. One that will help save Main Street Businesses, your local barbershop that you go to every few weeks. The local nail salon that’s been in your community for years, they need your help right now.
Many have not heard of this program yet and it is all of our responsibility to use our voices, united to spread awareness.
Our voices matter, let’s make sure they don’t fall on deaf ears.