Just four days after the Paycheck Protection Program became available to freelancers and self-employed people, the Small Business Administration announced the program was out of money.
The PPP was meant to be a lifeline to keep small business owners afloat, keep staff employed, and cover some operating expenses. For freelancers, the forgivable loan could be used to replace self-employment income for eight weeks, up to a total of $15,385.
Applications to the program for businesses with less than 500 employees opened on April 3, but individuals were barred from submitting their applications for an additional week. In that time, a number of large, well-funded companies used loopholes to take money from the program that should have gone to struggling independent workers and small businesses in genuine need. (Major restaurant groups Shake Shack and Ruth’s Chris, each with multimillion-dollar valuations, took $10 million and $20 million in PPP funds, respectively.)
As a result, while freelancers struggled to find SBA-approved lenders who would accept their applications — because of the demand, most large banks only processed PPP applications from those with whom they had an established business relationship — the program’s funds were rapidly running out.
Freelancers now find themselves in the same position