PPP Loans Covered Less Than a Month of U.S. Small Firm Expenses

As a fresh round of federal relief loans is getting distributed to U.S. small firms hit by a pandemic crisis that will soon stretch to a year, new research shows that last year’s tranches of the Paycheck Protection Program covered less than a month of business expenses.

PPP loans provided in the March 2020 Cares Act on average covered 3.8 weeks of expenses, according to a report by JPMorgan Chase Institute that examined cash flows of small businesses that received funds in May and July. For retail firms, among the hardest hit by lockdowns and other activity restrictions, PPP loans covered 2.1 weeks of expenses, the lowest of all industries.

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