64% of companies requesting PPP funds got money
The survey data comes from owners that the SBA classifies as small businesses.
In mid-June, a third (34%) of respondents applied for a PPP loan and of those who had done 64% received a payment. And 15% of them have had their application approved and are awaiting payment. Only 10% of them have submitted their documents and are waiting for their approval.
PPP loan application success rate
Of the business owners surveyed, a resounding number (90%) believe that the paycheque protection program flexibility provision of the law, extending the pardon period from eight to 24 weeks, would have an impact on their business. Another 82% say the same about extending the loan repayment term from two to five years. They say it will also have a positive impact.
Other perceived benefits of the Flexibility Act include deferred payroll taxes (80%) and forgiveness being allowed even if the entire workforce does not return (78%).
More than half (60%) say the P3 will help them retain or rehire all of their employees. While 28% of them say it will help them retain or rehire at least half of their workforce before the lockdown.
“The PPP Flexibility Law has removed some of the barriers that prevent companies from getting the most out of their PPP loans during the reopening phase and beyond,” mentionned Martin Mucci, President and CEO of Paychex.
PPPs give businesses a head start
In mid-June, almost half (49%) of those surveyed said they were fully open and operational. Almost the same number (42%) say they are open on a limited basis. A fraction (9%) say they are currently not open, but intend to reopen.
Of the businesses closed, 12% plan to open this month. Another 27% plan to reopen in July while the same amount (27%) plan to reopen after July. However, 19% of these businesses are still waiting for conditions to improve before reopening.
Already 30% of companies say they are already profitable. Despite the optimism, businesses expect to face reopening challenges. Almost a quarter (26%) fear that too few customers will come back to them when they open. Others predict that customers may not be comfortable going to their place of business (20%). And others wonder how to get the word out when they actually open (18%).
On communicating with customers when they are open. 28% say they take the opportunity to allay their concerns by addressing their practice of safety and social distancing. While 22% are transparent about their cleaning practices. The three primary means of communication used by businesses to interact with customers on these issues are email, word of mouth, and phone calls.
Surprisingly, 35% of business owners haven’t used any promotions to let customers know they’ve reopened. Another 35% said they did not advertise differently than they were before the pandemic.
What companies are doing differently
According to the survey, 24% of companies allow employees to work from home permanently during the post-lockout period. From an industry perspective, professional service companies are much more likely (36%) to have permanent work-at-home policies in place than their counterparts in other industries.
Companies also plan to continuously increase their use of technology to increase employee productivity (23%). A small portion (18%) said they plan to offer flexible hours for employees in the future.
The crisis has also strengthened community spirit, with businesses recognizing that they are in the same boat. About 70% of respondents say they make an effort to support other local businesses during this period.
The law on flexibility promulgated on June 5, 2020, made key changes to the program that make it easier for small businesses and the self-employed to comply with program requirements and obtain loan cancellation. Additional changes include making more PPO lenders available as well as extending the period to spend the loan.
With an average loan size of $ 113,228 and 5,458 lenders participating in the program to date, more than 4.6 million loans nationwide have been approved. Remember that loans can be canceled entirely if companies spend 60% of them on payroll; pay interest on mortgage, rent and utilities. The program officially ends on June 30, 2020.
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