The popular Paycheck Protection Program was rebooted Monday morning, but it was not quite the mad dash for dollars seen last spring.
That’s because under guidance released last week by the federal agencies administering the small business relief effort, only a narrow sliver of businesses and lending institutions are able to apply for and process loans.
Indeed, only one bank in the state, the Detroit-based First Independence Bank, was permitted to take in loan applications on Monday and Tuesday, based on the federal guidance. First Independence is a Minority Depository Institution (MDI), and one of a small number of Black-owned banks in the United States.
Some institutions other than banks could also process loans on Monday and Tuesday: Community Development Financial Institutions (CDFIs), Community Development Corporations (CDCs) and Microlender Intermediaries.
The only businesses able to apply for the potentially forgivable loans on Monday and Tuesday are those that did not receive a loan last spring during the PPP’s first two tranches of money.
First Independence Bank Chairman and CEO Kenneth Kelly told Crain’s on Monday afternoon that the day has been busy and primarily focused on outreach efforts to small businesses in cities like Detroit where data has shown entrepreneurs had less access to PPP funding last year.
“This is a little bit of an effort to be more inclusive and hopefully get the word out in a way that’s not intimidating to these really small businesses in under-served communities,” Kelly said of the guidance issued late last week by the U.S. Department of Treasury and Small Business Administration (SBA), the two agencies administering the program.