The Center for Public Integrity: PPP Loans Were supposed to Prioritize Low-income Areas During The Pandemic. They Didn’t.

The Center for Public Integrity, December 11, PPP Loans Were supposed to Prioritize Low-income Areas During The Pandemic. They Didn’t.

Congress wanted the U.S. Small Business Administration to ensure that PPP loans prioritized small businesses in “underserved” markets, a term that includes low-income communities, rural areas and businesses owned by people of color, women and veterans. But the SBA’s inspector general warned in early May that it could find no evidence the SBA told lenders to do that. By the time the agency sent a memo to that effect in mid-June, nearly all the loans had been issued.

Advocates and lenders heard many stories from small business owners who couldn’t get help or basic information from their bank during the early part of the PPP.

The National Community Reinvestment Coalition said it found unequal treatment during its “mystery shopper” tests of national and regional banks, in which pairs of testers with similar financial profiles but different races asked for small-business assistance.

Print Friendly, PDF & Email

Leave a Comment

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Redlining and Neighborhood Health

Before the pandemic devastated minority communities, banks and government officials starved them of capital.

Lower-income and minority neighborhoods that were intentionally cut off from lending and investment decades ago today suffer not only from reduced wealth and greater poverty, but from lower life expectancy and higher prevalence of chronic diseases that are risk factors for poor outcomes from COVID-19, a new study shows.

The new study, from the National Community Reinvestment Coalition (NCRC) with researchers from the University of Wisconsin–Milwaukee Joseph J. Zilber School of Public Health and the University of Richmond’s Digital Scholarship Lab, compared 1930’s maps of government-sanctioned lending discrimination zones with current census and public health data.

Table of Content

  • Executive Summary
  • Introduction
  • Redlining, the HOLC Maps and Segregation
  • Segregation, Public Health and COVID-19
  • Methods
  • Results
  • Discussion
  • Conclusion and Policy Recommendations
  • Citations
  • Appendix

Complete the form to download the full report: