It’s been over two months since the Paycheck Protection Program started guaranteeing low-interest, forgivable loans to small business owners affected by the coronavirus pandemic across the U.S. One of the biggest questions emerging from the rollout and execution of the program was “Where did the money go?”
The first round of PPP funding was marred by a bottleneck of applications, unclear guidelines, and reports of big corporations from Shake Shack to the Los Angeles Lakers receiving loans. While the second round of funding went more smoothly, many are still wondering which businesses were able to reap the benefits of this taxpayer-funded program.
Using a combination of data collected by our partners at COVID Loan Tracker, as well as the data that the SBA has made available, we’ve compiled a list of takeaways about which businesses received PPP loans.
According to the SBA, 64.9% of all respondents said that they received a loan for $50,000 or less.
Large loan amounts got a lot of attention in the media, but according to SBA data, they made up less than 2% of all PPP loans disbursed.
That being said, in terms of actual dollars, loans of over $1 million makes up over 35% of all the loan dollars given out so far. Loans under $50,000 make up just over 10% of loan dollars allocated.
According to SBA data, the average loan size is $113,000 so far.
This industry, according to NAICS, includes “legal advice and representation; accounting, bookkeeping, and payroll services; architectural, engineering, and specialized design services; computer services; consulting services; research services; advertising services; photographic services; translation and interpretation services; veterinary services,” and more.
SBA data show that this industry received over 589,000 PPP loans, more than any other industry.
Although this industry, focused on medical workers and social workers, received over 100,000 fewer PPP loans than professional, scientific, and technical services, it actually received more net dollars from the program with $66.1 billion, according to the SBA.
For the most part, the list of states that received the most loans (according to the SBA) and the list of states by population were aligned. California, the most populous state in the country, had the most PPP loans at 530,695. Texas, Florida and New York round out the top four, matching with their populations.
There were a couple of small surprises among the top states, however. New Jersey received the eighth-most PPP loans in the country, despite being just 11th in population. Colorado received the 14th-most PPP loans but is just 21st in population.
According to the SBA, Arizona businesses received fewer PPP loans than a number of smaller states. While Arizona is 14th in the country in population (and boasts one of the largest cities in the country in Phoenix), it trails Massachusetts as well as Virginia, Colorado, Washington, Missouri, Tennessee, and Wisconsin in terms of total PPP loans.
The SBA’s report lists the top 10 PPP lenders by total PPP funding, as well as each lender’s loan count and average loan size.
While JPMorgan Chase disbursed the most PPP funding with over $28 billion in loans, Bank of America made the most overall PPP loans with over 325,000. Of the lenders in the top five, Wells Fargo had the lowest average loan size ($59,408). PNC Bank had the fewest overall loans in the top five, yet had the highest average loan size ($179,848).
The SBA has made a push to ensure people who bank with smaller lenders (such as banks with less than $1 billion in assets) or go through community development financial institutions (CDFIs) and non-bank lenders have access to PPP.
Of the more than $600 billion that has been allocated to the PPP, over $97 billion so far has been disbursed through a combination of small banks, small credit unions, fintechs, farm credit lenders, non-bank CDFI funds, and other lenders with less than a billion in assets. Over 1.2 million PPP loans have gone through these lenders.
According to COVID Loan Tracker’s survey, just under 75% of respondents that took out PPP loans said they were either an S-Corp (38.8%) or an LLC (36.1%).
LLCs and S-Corps can be big businesses, but more often they are small—such as single-member LLCs. S-Corps are also generally smaller than C-Corps, since they cannot have more than 100 stakeholders and are subject to pass-through taxation, similar to sole proprietorships.
Only a small portion of respondents to COVID Loan Tracker’s survey said that they were sole proprietors or independent contractors.
In fact, respondents were more likely to be C-Corps (11.7% of all PPP loans went to these entities) than sole props (7.8%) or independent contractors (0.9%).
According to COVID Loan Tracker, 55% of the loans that went to retail businesses were for $50,000 or less.
Loan amounts are based on monthly average payroll, but the loans are also meant to cover expenses such as rent and utilities, which can be higher for retail businesses in major cities.
That means just 2.8% of PPP loan applicants were denied a loan when they applied, according to COVID Loan Tracker data. The PPP was designed to get money into the hands of business owners quickly, regardless of credit history or other factors that typically dictate loan approval success.
For more information and resources regarding the disbursement of PPP loans and other emergency financing related to the coronavirus pandemic, visit COVID Loan Tracker. You can also contribute information on your own PPP and EIDL application and forgiveness experiences through COVID Loan Tracker’s survey. Visit Fundera’s coronavirus pandemic resources page as well for insights into operating and succeeding despite the pandemic.
Note: Data from the SBA is current as of 6/6/2020.