When the shutdown happened in March of 2020, many businesses were forced into closing their doors or adapting their methods to fit the regulations. Because of this, many businesses suffered financially and some even shut down for good as a result of their financial instability, according to San Diego corporate attorney Brad Nakase at Nakase Wade law firm. Nakase Wade’s class action lawyer has advised many business during the pandemic to avoid being sued by employees.
With all of this negativity, there was one symbol of hope for many small businesses: The paycheck Protection Program, otherwise known as PPP loans. With these loans, businesses that have fewer than 500 employees were able to get a loan that was over 2 times their normal amount. This, of course, was dependent upon whether 60% of it went to payroll, but that wasn’t a problem for businesses with many employees.
At the start of these loans being available between April and May, businesses were fighting to receive them. While these funds were readily available at the start, the finds have since diminished and there isn’t much left to give. Because of this troubling circumstance, it is predicted that many businesses will be shutting their doors permanently.
Hopefully, for these businesses, there may be another round of PPP on the way. According to the U.S. Senate, another stimulus package is being worked on and will be provided to those whose businesses are struggling the most.
However, qualifying for this second round of loans is going to be much more strenuous and challenging. In the first round, businesses were able to receive the loans based on economic certainty, but this second round is only going to be given to businesses that need it.
Also, this second round of PPP won’t be as free as the first round. Rather, there will likely be many restrictions that come along with it.
While there is still a lot to figure out with this second round of PPP loans, businesses are hopeful that they will receive some sort of relief and soon.