Hours after Harvard sent out an email informing students of the need to evacuate campus, my mom called dropping another piece of news: we had to close our family child care business by the end of the next week. While juggling midterms with trying to pack and move all my belongings out in two days, the weight of her words flew over my head. I remember asking, “will we be okay?” and she brushed it off, “yeah, we’ll talk more later.” We did not talk more later; there wasn’t time. Applying for the Payment Protection Program would consume my next six weeks so that we could pay our rent and employees.
As the eldest child, I have helped out in the family business since its start — a common expectation for the children of immigrant entrepreneurs that has only intensified during the pandemic. My lack of experience with any task required of me was irrelevant, and the PPP application was no exception. The question asked was not, “do you think you can help me with this?” but instead, “how fast can you figure this out and get it done?” I was mostly alone in navigating the process; although my mom speaks English proficiently, it is her second language, and she didn’t fully understand the complicated financial language used. The PPP program failed to meet the needs of the struggling small businesses it aimed to reach, favoring larger organizations with the capacity and connections to better navigate the arduous application process by rolling out without clear guidance and resources for further assistance. In doing so, the program has followed the broader trend of federal aid becoming a tale of the have and have nots. It forgot that true small businesses don’t have accounting firms, teams of financial advisers, or a CFO on hand. Like in the case of my family, all they may have is an 18-year-old daughter.
Finding the Pieces
The SBA, in consultation with the Treasury Department, didn’t release guidance to lenders until hours from the PPP’s launch, leaving unanswered questions on how banks should handle the incoming surge of applications from 30 million small businesses. Such limited and rushed guidance caused delays between the beginning application date and when banks were ready to set up their application portals. The delay period was one of widespread misinformation. When I asked where I could apply, I got three different answers from three different banks before starting my application with Chase.
Technical difficulties plagued Chase’s portal, and customers were eventually required to apply over the phone. I was emailed forms and given the impression that if I didn’t have them filled out by the call without any mistakes, they would skip me, and my application wouldn’t be submitted before funds ran out. However, they didn’t provide me with a time frame for when to expect the call. Fearing I would further delay submission if I weren’t prepared, I stayed up all night working on the forms despite my midterm the next morning.
Filling out the many forms was like trying to put together a jigsaw puzzle without knowing how many pieces it’s composed of, or what the final image looks like. Oh, and you intermittently get new pieces, some of which actually belong to other puzzles. I didn’t know what documents and figures I should reference to fill out the form’s blanks, so I would scan form questions for key terms, google what documents I could find the answer to those questions on, then ask my mom to search for said document. I received documents in batches, and sometimes I’d get one that completely changed the values of the forms I had already filled out and have to start over.
My lack of experience aside, the forms were far too complicated and unclear for businesses simply fighting for their survival, especially without additional guidance. No banks were taking calls. Google was my only available resource. When I looked up definitions for terms used in the Personal Financial Statement, a site unhelpfully advised me to consult an accountant. We also weren’t informed about what variables were involved in the calculations for “Average Monthly Payroll” or “Use of Proceeds” — critical values that would determine the loan amount we would receive. Without an accountant or guide in sight, what was a sleep-deprived girl under immense pressure supposed to do? In hindsight, it seems excessive, but I prepared an application for every possibility I saw, resulting in eight sets (40 pages of hand-filled forms, eventually reaching over 150 pages by the end of the six weeks).
Stretched Too Thin
When Chase called, I did not get the chance to ask any of my questions as the banker merely informed me that the website’s application portal should be working. Luckily, I was in a large lecture so I could slip away and pick up the call. If I’d been in a different course, I have no idea what I would’ve done, definitely not private chatting the TF, “sorry, I need to leave because the bank called, and if I don’t pick up, my family may continue having no income.” The portal still had technical difficulties, but after countless page refreshes and coming back to it hourly six times, I successfully submitted only to find out five days later that PPP funding had run out. My application didn’t even make it to being submitted to the SBA, joining around 30,000 others in Chase’s queue.
“We never had a chance. The banks helped their richest customers first,” was all my mom said. The days after, I wondered our chances had indeed been so influenced by factors out of my control? After all, how could I have competed with Shake Shack and the Los Angeles Lakers? In the email Chase sent, they proudly claimed, “80% of our PPP loans have been for businesses with less than $5 million in revenue.” 20% still seemed like a substantial portion to me, though. So how would this process have looked for one of those companies? Well, private or commercial banking clients weren’t frantically Googling and struggling to get their bank to pick up their calls. They were able to bypass the technical difficulties of the online portal and directly enlist their banker for step-by-step assistance or even to apply on the client’s behalf.
Round 2: Let’s Try This Again
My mom had heard from other Chinatown small business owners that those who had gone to local, community banks fared much better in getting their applications processed. It is uncertain whether their success was because larger banks had more applications to process, waited for additional guidance for fear of mistakes in paperwork, or truly prioritized their wealthier customers. Regardless, when the SBA replenished PPP loan funds for a second round, the difference in my personal experience between applying through a community bank and a more corporate bank was night and day. The biggest difference was that the community bank seemed more committed to helping small businesses. Because they work with small businesses every day, I think they better understood how to help and provide the resources to meet the challenges that come with owning one.
Immigrants are twice as likely to start a business compared to native-born citizens and comprise 30 percent of new US entrepreneurs, so it surprised me that the Treasury Department did not offer the application in different languages. The community bank asked for our preferred language of correspondence and provided a copy of the forms with Chinese annotations and term explanations, allowing my mom to take a more active role in the process. The bank also included an example application that answered nearly all the questions I had regarding calculations during the first round. Furthermore, there were spaces in the sample that I wouldn’t have known to leave blank. Now that I was finally provided an image for my “puzzle”, what took me weeks of allnighters in round one only took a few this time around. These two resources could have been easily compiled and provided by larger lenders or the Treasury Department and would’ve made a world of difference for the mom and pop businesses the PPP program was intended to help. Without these resources, I doubt the SBA would’ve approved our loan application for the second round.
After Approval
Although the pandemic has definitely led to a greater understanding of people’s differing circumstances, there is still a boundary of what is socially acceptable to share; Acceptable is “I am going stir crazy” or “I ran out of stuff to do,” not “I have slept five hours over the past four days because I’m trying not to lose what my family has poured our past decade into.” Every step of the process reminded me of what was at stake for my family — a business that supports twelve of our members, a business started in my childhood living room and kitchen that’s grown up alongside me. Filling out the spaces for “number of employees”, “number of jobs created”, and “number of jobs retained” on each form only emphasized the stakes for those our business employed.
In a time where social interaction with my usual support channels was already limited, I felt I was living a double life of sorts. During the day in my classes and extracurriculars, I acted as if everything was usual; I thought there was already so much bad news, why share my own on top of it? At night, I was on autopilot, staring at a computer screen for hours, prioritizing whatever needed to be done for the application process before moving onto my homework. And in those six weeks, I was expected to play the roles of a good student, friend, financial adviser, daughter, editor, and contributor — leaving no time to be myself fully.
Currently, small businesses, including my family’s, are undergoing the next phase of the PPP process: receiving loan forgiveness. Every member of the Senate Democratic caucus has signed a letter pushing for the SBA and Treasury to simplify the loan forgiveness application. They are also urging for additional resources like a streamlined form for smaller loans, a help hotline for applicants, and specialized online tools, as well as the collection of applicants’ demographic data to ensure equal access to funds by minorities. With this following application being three times longer than the original, our government must minimally meet these demands, or it will once again risk shutting out businesses in underserved communities.
Image Credit: Documents by Pixabay are licensed under CCO