Monday, April 13, 2020
Billionaire Mark Cuban says "Banks are leaving small businesses out in the cold."
Mark Cuban stated that the small business loan program (Paycheck Protection Loan) that was recently launched could have a terrible impact on small business long-term. Banks are making decisions about who gets loans based on an individual business' credit. With that being said, Cuban believes that a lot of small businesses will be "left out in the cold". He also stated that the economy is now at a turning point to get money into the system for all different types of businesses. Cuban is also a major investor on shark tank and expressed that a lot of the businesses he has invested in are struggling to acquire loans. Banks have put hurdles to make applying for the Paycheck Protection Loan extremely difficult. The government has set aside $350 billion dollars for the small business loan program in order to help prevent businesses from going under and helping them maintain paying their employees. However, banks have been making it extremely difficult for businesses to gain access to the fund. Until that friction between banks and businesses are resolved, many businesses are going to capsize.https://www.cnbc.com/2020/04/13/mark-cuban-banks-are-playing-leaving-small-businesses-out-in-the-cold.html?&qsearchterm=mark%20cuban
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I think since this is the first tome something like the Paycheck Protection Program has been launched, and the demand for the funding is so high, there are bound to be technical difficulties on the bank's side that might hinder the process. Banks are not really processing the requests at a timely manner either, since the PPP loans can take anywhere between 2-3 weeks to begin processing. I think it is a great option for small businesses to have this option, but they can not solely rely on it.
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