https://www.bloomberg.com/graphics/2...ction-program/
This article is interesting as it shows that the PPP SBA benefits have gone disproportionately to red states and infers it may be for political reasons. I have a fair amount of insight as to how this program has rolled out and I honestly don’t believe their is any political motivation to this and think it’s just based on circumstances. Originally each participating bank got an allotment of dollars they could lend through the program. That got scrapped pretty quickly because Wells Fargo and I think B of A had such a large amount requested they eliminated that cap.
But I think In red states you have more regional and community banks that have more personal small business banking relationships and thus they were able to cater to their clientele quicker and easier. The large banks just got so overwhelmed with requests.
The crazy thing though is through this program the banks had absolute control and say over which customers they allocated their dollars. And obviously smart business dictates you look out for and prioritize your best clients. Who are also likely the ones who are the least in need of the free money. And it is free money so long as you meet the terms. The little guys who were most in need likely are getting screwed in this program. The 349B is already all allocated. I think Congress will ultimately raise the amount but time is money for these small businesses right now.
If you’re a small business that doesn’t have a lending relationship, I.e. deposit only you most likely totally got screwed. I know some banks initially looked at this as an opportunity to gather new business by taking on some new clients that fit that profile but this thing moved so fast there was virtually no way that had time to materialize.
When you think about it is a socialist program benefiting capitalists.