For weeks, Fintech firms have been fighting to be able to engage in the emergency loan scheme for small businesses through the US government. Those efforts have now paid off, like PayPal, Intuit and Square have now been allowed to join the U.S. Paycheck Insurance Plan for Small Business Administration (SBA), which offers assistance in the form of forgivable loans for small companies who keep their workers on their payroll for at least eight weeks.
The $350 billion Small Business Loan initiative is part of the $2 trillion Coronavirus stimulus package from Congress, which is targeted at those firms with less than 500 employees.
PayPal revealed on Friday that it had been approved as one of the first non-bank institutions to be able to help administer the loans under the SBA scheme, after securing its clearance for inclusion in the project.
Before today the firm has also been working as a small business loan, it added. Since 2013, PayPal has supported the company owners with loans and cash advances. To date, those programs have provided access to financing totaling more than $15 billion for over 305,000 small enterprises.
“We are ready to invest our resources and expertise to help small companies navigate this difficult time,” said Dan Schulman, president, and CEO of PayPal, in a statement. “The first credits were applied for and released. We plan to be releasing more loans in the coming days. Due to Congressional representatives and the President for enforcing the CARES Act, companies like PayPal have been able to help allocate money efficiently to the industries most impacted, “he said.
Additionally, on Monday, Intuit outlined some of the latest services that were implemented in response to the COVID-19 situation and the subsequent policy aid programs. This launched the first of these efforts with the introduction of Intuit Help Assist, a free website intended to help small business owners and self-employed individuals decide how much federal aid they are entitled to under the SBA-administered Coronavirus Support, Relief, and Economic Security Act (CARES).
And like PayPal, on Friday Intuit’s QuickBooks Capital obtained clearance for the SBA’s Paycheck Security Plan (PPP), as a non-bank lender. Small business owners can get assistance with QuickBooks Money in assessing their eligibility for federal relief. The program also simplifies the process of the transaction, using automation. This also disburses the PPP funds in conjunction with the SBA, making it easier to get access to the aid.
“Many customers and small businesses fail to make ends and provide for their children. We face a loss of sales and a lack of resources to survive the crisis, “said Sasan Goodarzi, CEO of Intuit.
Intuit has also recently launched Stimulus Registry, a new Turbo Tax program targeted at helping customers prepare and obtain federal approvals of their stimulus. For less than two weeks, Intuit reports more than 165,000 Americans have used the app to invest for federal stimulus funds worth more than $230 million.
A group of fintech technology pioneers known as Financial Innovation Now in March had written a letter to lawmakers who wanted to be active in the distribution of funds to small businesses alongside banks. The alliance — including Square, PayPal, Intuit, Stripe, and others — argued that they had “the scope, partnerships, and digital resources to serve the most vulnerable companies” in a more timely manner than traditional financial institutions.