Question of the Week
How can we help minority-owned businesses shut out of PPP Loan relief?
After a bumpy start, money from the Paycheck Protection Program (PPP) is flowing. As of Friday May 8th, the program has made over 2.5 million loans with a total value of $187.1 billion—about 60% of the $310 billion available in round two. That’s great news, especially for small businesses and independent contractors left out of round one.
Despite this progress, PPP still has a huge problem. An April 6th report from the Center of Responsible Lending (CRL) found that roughly 95% of Black-owned businesses, 91% of Latino-owned businesses, 91% of native Hawaiian or Pacific Island-owned businesses, and 75% of Asian-owned business “stand close to no chance of receiving a PPP loan through mainstream bank or credit unions.”
Minority-owned firms have been shut out for a variety of reasons. They’re less likely to have a relationship with lending banks, their owners may not have access to financial and legal expertise or their payrolls aren’t as large. Even with adjustments in FinTech and community bank funding, as well as $60 Billion being set aside for community banks, CRL’s Federal Advocacy Director Ashley Harrington said it won’t be enough and this approach “perpetuates the racial wealth gap and breeds public resentment and distrust.”
This is not the first time communities of color have been left out of sweeping government reform. This moment provides an opportunity for us to explore and take significant steps towards fixing a monumental problem.
When figuring out how to make significant change, let’s start with the three As — Awareness, Acceptance and Action. Awareness involves taking an honest look at ourselves and our circumstances. Acceptance of that understanding allows us to assess and learn from that experience. That acceptance then leads to taking action towards the change we wish to make.
I’ll use this framework to help us explore what can be done to help business owners of color get access to the funding that they need, and in the end make our economy as a whole stronger.
Quote of the Week
“If civilization is to survive, we must cultivate the science of human relationships – the ability of all peoples, of all kinds, to live together, in the same world at peace.” – Franklin D. Roosevelt
Task of the Week
In the article, I argue keeping the focus on ourselves and letting others do the same can have a compounding effect. What are your three commitments? Specifically, what actions can you take to create awareness or encourage acceptance around this issue. How can your actions create the change you want to see?