Created by the Coronavirus Aid, Relief and Economic Security Act, which was signed into law by President Trump on March 27, 2020, the PPP provides small businesses with low-interest loans in an effort to help them maintain their payrolls and keep employees in their jobs through the COVID-19 pandemic. Provided borrowers meet certain requirements, PPP loans are eligible for forgiveness and essentially function as grants.
The PPP extension received unanimous support from both houses of Congress. The Senate approved the PPP extension on June 30, 2020, just hours before the application deadline was set to expire, which paved the way for the House of Representatives to set aside procedural rules and pass the measure the following day.
Demand for PPP loans began strong but has since slowed in recent weeks. Initially funded with $349 billion, the first round of PPP funding was depleted in less than two weeks, which prompted Congress to inject additional funds into the program in April to keep up with demand. According to the U.S. Small Business Administration (SBA), as of June 30, 2020, small businesses have received more than $520 billion in PPP loans and more than $130 billion in funds allocated for the PPP remained unused.