Small Business Loan Program Grows with PayPal, Square, Intuit

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A number of fintech companies — many of them household names — can now participate in the federal government’s Paycheck Protection Program, and that’s good news for dozens of small business owners who don’t. may not have existing relationships with major banks who have prioritized this in accepting applications so far.

Square, PayPal, and Intuit are among a group of alternative lenders the Small Business Administration has now approved to participate in the $350 billion program that provides government-backed low-interest repayable loans to save money. small businesses crushed by the novel coronavirus. impact.

This comes as PPP is nearly cash-strapped and still plagued with issues, some of which still exist with the SBA’s online loan application portal used by all lenders known as E -Tran, which was down on Monday, according to a banking industry source. . The SBA denied this to ABC News on Monday, with spokeswoman Jen Kelly saying, “E-Tran operates and makes billions of dollars in loans.”

White House economic adviser Larry Kudlow said over the weekend in a Fox interview that the program was supposed to dry up by Friday, and Congress is still bickering over funding.

It’s unclear what the influx of lenders and demand on an already overloaded system might mean; Still, demand for the program is high, according to those alternative lenders who have lobbied Congress to be included in the PPP, and many intend to help the little guy, already counted among their clientele.

PayPal, which serves more than 10 million small businesses in the United States, has started accepting applications and, according to spokesman Joe Gallo, has already funded some loans, although it would not disclose further details.

The company prioritizes existing customers, but does not rule out opening the door to others.

“At this time, our focus is on our more than 10 million US small business customers. We continue to monitor the situation and update as necessary,” Gallo told ABC News.

Gallo also said his company’s participation in the program would mean much-needed aid would be channeled to underserved communities he called “banking wastelands” – counties where banks have closed since the 2008 financial meltdown. .

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Square – which has millions of sellers worldwide, most of them in the United States – plans to start accepting applications this week, according to spokeswoman Katie Dally who told ABC News that the company sees a huge opportunity to help sole proprietors and small independent businesses. business owners.

While the company will eventually be open to all small businesses, Square has planned an “app rollout,” prioritizing existing customers who can easily autofill forms, like payroll for those using Square Payroll.

“We can easily transfer these people’s data, so it will go a lot faster,” Dally said. “We expect strong demand. We have been working with our seller base since April 3.”

Square and PayPal partners work in partnership with the banks, Celtic Bank and WebBank, respectively.

Intuit said its Quick Books Capital program would be able to “simplify, automate and accelerate the PPP application and funding process.”

“We are working to get customers help as quickly as possible as they navigate this unprecedented and difficult time,” said Alex Chriss, executive vice president and general manager of QuickBooks.

Like Square and PayPal, Intuit said it will also prioritize existing customers.

“Federal PPP relief processing will initially be available to a subset of QuickBooks Online Payroll customers who can begin applying as early as next week,” the company announced Friday.

“Payroll information validation is required to complete the PPP application. For QuickBooks Payroll customers, customer data is already in the QuickBooks system. Therefore, we are well positioned to help expedite the loan application process. for this group, 12 American workers are paid through our payroll systems, making this an impactful starting point,” said Luke Voiles, Vice President and Chief Business Officer of QuickBooks Capital.

This weekend, Kudlow said PPP had seen some 661,000 loans approved for a total of $168 billion. Neither the SBA nor the Treasury Department said how much money was shelled out.

“Those are huge numbers. That’s one of the reasons, by the way, according to our estimates, we’re going to run out of money for small businesses on April 17,” he said. “That’s why we would like Congress to help us with another $250 billion.”

There is little to no disagreement on whether or not to increase PPP by this amount, the question remains, can Democrats and Republicans come to an agreement on whether to fund other programs and urgent needs now or save them for the next, but- certain recovery plan.

ABC News’ Sarah Kolinovsky contributed to this report.

What you need to know about the coronavirus:

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