NEW ORLEANS, La. (WVUE) - With no news on a deal from congress, small business owners a hope for future financial assistance.
Many of the small businesses counting on federal forgivable loans are waiting for word on a deal from congress. But some in New Orleans fear the money may not come at all, despite approved applications.
“If I go under, where are these families going to go?” questioned Alicia Winter.
It’s a real fear for the childcare provider. Winter closed the doors to Benjamin Thomas Academy after the stay-at-home order. Though she says she won’t be able to reopen any time soon, Winter is still paying her 12 employees.
“It’s scary times. My teachers are depending on me. My families are depending on me so, I don’t know how much longer I’ll be able to stay open, stay alive if this continues to be the issue,” Winter explained.
The issue is her inability to get federal funding promised for small businesses. Winter applied April 4 and soon received a confirmation email indicating her lender, Chase Bank, had all the appropriate paperwork.
“Then two weeks of silence. And then I just got this generic email saying they ran out of funds,” said Winter. “I’m just really sad I didn’t get any communication whatsoever.”
The nearly $350 million in the federal program for small businesses was gone in less than two weeks.
“It really affects the economy because small businesses are the backbone of our economy,” Winter said.
Meanwhile, Winter has kept an eye on recent controversy surrounding million dollar loans awarded to big businesses. Litigation is now in the works against lenders like Chase, Wells Fargo and Bank of America. Claims allege they prioritized larger loans due to the larger processing fees they’d receive.
“I feel like they maxed out all their loans on bigger businesses that don’t really need it as much is a smaller businesses,” explained Winter.
Though Winter is now officially approved, she still has concerns.
“I have a feeling that even when funding is available that we still aren’t, my business is too small. What’s the incentive for these big lenders?” Queried Winter.
“If that turns out to be true, that would be really disheartening,” said Scott Wood.
Wood has a similar story with the same lender, still waiting for Payment Protection Program funds. He’s head brewer and Owner of Courtyard Brewery. It’s operating on a to-go only basis, down close to 90-percent in sales. What’s most concerning for Wood is what happens to employees during the slow summer months when extra unemployment runs out at the end of July and he has no federal funding.
“If we’re back up and operating after not having festival season, and lost all the money we would’ve made during festival season, then it becomes extra problematic,” Wood explained.
Both Wood and Winter are looking into other financial assistance programs with little luck so far.
“It’s just kind of like desperate times right now and I’m a small business owner so it doesn’t take much for us to shut down,” Winter said.
FOX 8 spoke to other small business owners who had issues with other lenders, like Capital One.