President Joe Biden on Tuesday signed a two-month extension of the Paycheck Protection Program, which offers loans for small businesses struggling with the economic toll of the coronavirus pandemic.
Biden signed the extension in the Oval Office alongside Vice President Kamala Harris and Isabella Casillas Guzman, the administrator of the Small Business Administration, less than a week after Congress gave final approval to the extension.
“It is a bipartisan accomplishment,” Biden said before signing the act. “Small business is the backbone of our economy.”
The House approved the extension on a 415-3 vote this month, and the Senate on Thursday cleared the legislation on a 92-7 margin. The program had been set to expire Wednesday. The extension also gives the Small Business Administration an additional 30 days to process loans submitted before the new May 31 deadline.
The federal loan program was first established in the $2.2 trillion stimulus law passed last March under President Donald Trump. In December, Congress restarted the program and added more funding. Around 3.5 million borrowers have received forgivable loans this year, taking the program’s total lending to $734 billion.
The Biden administration overhauled the program in late February, prompting self-employed people and the smallest of businesses to rush to take advantage of newly freed-up aid. The extension by lawmakers gave small businesses, as well as lenders, more time to adjust to the overhaul.
Biden said the extension would especially help small businesses in minority communities.
“Many small businesses, as you know, particularly Hispanic as well as African American small businesses, are just out of business because they got bypassed the first time around,” Biden said.
JPMorgan Chase, the program’s largest lender, had previously refused to make the Biden administration’s changes to the loan formula for self-employed applicants, saying it lacked the time to do so before the program’s deadline. A bank spokesperson said Chase will now make those changes in the next few days. And Bank of America, which stopped accepting new applications earlier this month, reopened its system Monday.
Around $79 billion remains in the fund. Banks and financiers, which make the government-backed loans, generally expect the money to be depleted in mid- to late April, well ahead of the program’s new deadline.
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