The first round of payroll protection funding ran out in less than two weeks and lots of applicants were shut out, but Philadelphia commerce director Sylvie Gallier-Howard says some businesses never even had a chance because the loans went through big banks.
“Small businesses often do not have relationships with commercial banks, and we knew a lot of people were not going to have access to those dollars,” Gallier-Howard said.
So the city lobbied to get more money funneled through community development finance institutions, sometimes called microlenders, on which the most vulnerable businesses rely.
“In economic recessions, entrepreneurs of color are hardest hit typically, so community development finance institutions being able to participate in this is key,” she added.
This round, $60 billion is going through those lenders. And one big bank, Goldman Sachs, earmarked $10 million just for marginal businesses in Philadelphia.
The application process can still be frustrating and the technology occasionally glitchy, but the loans provide eight weeks of payroll costs and will be forgiven upon proof that employees were kept on.