The Small Business Administration's rescue loan program reached its $349 billion limit Thursday and has run out of money, less than two weeks after the program was launched to help companies feeling the impact of the coronavirus pandemic shutdown.
"The SBA is currently unable to accept new applications for the Paycheck Protection Program based on available appropriations funding," the SBA's website said. "Similarly, we are unable to enroll new PPP lenders at this time."
Congress last month approved and President Donald Trump signed the first-come, first-serve Payroll Protection Program, which was intended to address the need for employers to keep meeting payroll without having to lay off or sideline employees during the Covid-19 crisis.
The money is part of the $2 trillion Coronavirus Aid, Relief, and Economic Security Act (CARES Act). The SBA said that 1.3 million Paycheck Protection Program loans had been approved with a total value of more than $296 billion through Wednesday afternoon.
The average loan size is $239,152, the SBA said.
On Wednesday, U.S. Treasury Secretary Steven T. Mnuchin and U.S. Small Business Administration Administrator Jovita Carranza issued a statement saying that "by law, the SBA will not be able to issue new loan approvals once the programs experience a lapse in appropriations."
“We urge Congress to appropriate additional funds for the Paycheck Protection Program - a critical and overwhelmingly bipartisan program -at which point we will once again be able to process loan applications, issue loan numbers, and protect millions more paychecks," the statement said.
Last week Senate Democrats thwarted a Republican plan to add $250 billion to the government’s small-business-lending program, insisting that the bill also include aid to hospitals, healthcare systems, state and local governments and food-assistance programs.
Staffers for Senate Minority Leader Chuck Schumer and House Speaker Nancy Pelosi are expected to continue talks with the Treasury Department on Thursday, CNBC reported, citing a senior Democratic aide.