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JPMorgan Chase Has Massive Small-Business Loan Backlog

By Bram Berkowitz – Updated Apr 20, 2020 at 10:39AM

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Funding for the Paycheck Protection Program ran out last week, but the bank still has $26 billion worth of loan applications. Lawmakers are working to replenish the program.

JPMorgan Chase (JPM -1.56%) claims to have originated more emergency small-business loans than any other bank, but it still has approved less than half of the total funding that small businesses have applied for.

The bank, according to CNBC, has a backlog of hundreds of thousands of businesses that have asked for roughly $26 billion in total loan volume.

Last week, the $350 billion Paycheck Protection Program (PPP) that was part of the $2 trillion stimulus bill and administered through the U.S. Small Business Administration ran out of money. 

JPMorgan Chase

Image Source: Getty

The SBA said it has approved more than 1.6 million loans so far, according to Politico.

Chase said it had funded about $14 billion through the program. Roughly half of those loans that the bank made were for less than $140,000, and more than 60% went to companies with fewer than 25 workers.

"Chase has secured more funding for small businesses than anyone else in the industry," Chase spokeswoman Trish Wexler told CNBC. "We're fully prepared to help many, many more once additional funding is approved. We're proud to support businesses that collectively employ more than a million hard working Americans."

Lawmakers are nearing a new deal that will replenish the program.

As of this writing, the proposed bill would allocate $310 billion more into the Paycheck Protection Program, with $60 billion specifically for rural and minority groups.

The remaining $60 billion would go to the Economic Injury Disaster Loan program, a different small-business loan program.

Bram Berkowitz has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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