Vox, October 5, 2020, The Paycheck Protection Program Failed Many Black-Owned Businesses
The Paycheck Protection Program failed small business, specifically Black owned businesses. The PPP involved a very confusing application, which left small businesses with failed results, due to not meeting the cumbersome criteria. An August survey reveals the largest amount of denied applications came from black owned businesses, a 23% denial rate compared to a 9% denial rate for white owned businesses.
Parker is one of millions of business owners who applied to the Paycheck Protection Program (PPP) — a federal effort to boost small businesses established by the CARES Act — and she’s also among those who was denied support with little explanation why.
“They said we didn’t meet the criteria, and they didn’t specify,” she said, adding that PayPal — the company she applied through — was very responsive, even though the process itself was cumbersome. “When I got the result back, I was like, I wonder if I just didn’t do it right — especially because there wasn’t a specific reason.”
Parker is far from the only business owner who’s dealt with confusion related to the program, and her experience underscores just how much it failed many small businesses. PayPal did not immediately respond to a request for comment.
According to August survey results that the advocacy group Small Business Majority provided to Vox, the program appeared to reach a lower proportion of Black-owned businesses in particular. In that poll, 23 percent of Black business owners who did not receive PPP or Economic Injury Disaster Loans said their PPP applications were denied, compared to 9 percent of white business owners, 13 percent of Latino business owners, and 9 percent of Asian American business owners. And in Michigan overall, only 3 restaurants that received PPP loans of $150,000 or more self-identified as Black-owned, compared to 223 that self-identified as white-owned, according to the Detroit Free Press.
