New NFIB survey of small businesses
AUGUSTA (May 21, 2020) – The latest data released by the Small Business Administration shows that in Maine 25,460 loans were approved for small businesses and $2,230,439,306 in funding was granted.
Today, the National Federation of Independent Business (NFIB), the leading small business association with thousands of members in Maine, released a national survey showing 80% of its members applied for a Paycheck Protection Program (PPP) loan and almost (90%) of applicants have received the funds, with most of that money arriving between mid-April and mid-May.
“The more than 25,000 Paycheck Protection Program loans in Maine clearly underscores the importance of the program as a lifeline for small business owners to find their way through the unprecedented shutdown of our economy,” said NFIB’s Maine State Director David Clough. “As the key author of the program, Senator Susan Collins has been instrumental in obtaining tweaks on issues such as loan forgiveness that will help people with their businesses down the road in the gradual reopening of the economy.”
“The Paycheck Protection Program has delivered financial assistance to 90% of applicants and has been a huge success for short-term liquidity for small business owners who are shut down due to government responses to COVID-19,” said NFIB’s Vice President of Federal Government Relations, Kevin Kuhlman. “The program Senator Collins created has helped small businesses in Maine and across the United States continue to pay employees and keep their doors open. NFIB looks forward to working Sen. Collins to increase flexibility and ensure the forgiveness element of the program is successful.”
Key findings from the survey include:
The majority of small businesses expect their expenses to be forgiven.
- Over half (54%) of owners with a PPP loan are expecting all of their expenses to be forgiven.
- Twenty-seven percent of borrowers expect at least 75% or more of loan expenses to be forgiven.
- Very few PPP borrowers are interested in using the funds as a low interest, two-year loans.
Complying with the PPP loan and loan forgiveness terms and conditions is challenging for small businesses.
- Twelve percent of borrowers report that spending the PPP loan within an 8-week forgiveness period is very difficult and 34% find the requirement somewhat difficult.
- Almost one-in-five borrowers find the forgiveness requirement that the borrower’s employee headcount match the pre-crisis employee headcount very difficult to reach since many businesses have already laid-off workers due to slower sales or suspended business activity.
- Another 28% find it somewhat difficult to maintain or return to their pre-crisis workforce level.
- The 75% payroll rule is difficult for 38% of small business borrowers to manage as 14% find it very difficult and 24% find it somewhat difficult
Owners have questions about how to spend the funds.
- Nearly three-fourths of small business borrowers find the terms and conditions of the PPP loan difficult to understand with 22% finding them very difficult.
The full survey is available here.