Data breakdown of loan awards for nonprofits versus for-profits would uncover sector’s most pressing and immediate needs
(WASHINGTON, April 13, 2020) – Independent Sector called on the Small Business Administration (SBA) today to release data on the breakdown of SBA 7(a) loans awarded to nonprofits versus for-profit entities under the CARES Act. This data would help the nonprofit sector better engage with government and businesses to provide necessary solutions to support nonprofits in this time of need.
The loans are designed to provide immediate relief for small businesses that are struggling in the wake of COVID-19. But since the SBA 7(a) loan application period opened, many nonprofits that provide crucial services—mental health support for military veterans; resources for immigrant teenagers and families; supplies for food banks and shelters; and financial services to families who’ve lost jobs due to the pandemic to name a few—have reported significant challenges in getting adequate support from the banking industry.
“For many nonprofits with limited banking relationships, this loan application process has been challenging,” said Dan Cardinali, president and CEO of Independent Sector. “We also have real concerns that charities, particularly those that are led by people of color or serve communities of color or tribal communities, may find themselves shut out of the process to secure financial resources that are critical to their very survival.”
On April 6, acting as a voice for the nonprofit and philanthropic sector, Independent Sector authored a letter offering loan assistance as part of the Paycheck Protection Program (PPP) under the CARES Act to prioritize nonprofits as loan recipients. More than 440 nonprofit and philanthropic organizations – large and small, and from across the nation – have signed that letter in support.
In addition to playing a vital role in serving the community, nonprofit and philanthropic organizations employ more than 10 percent of the private workforce and rank as the third largest employer in the country compared to other industries. Data on the breakdown of loan recipients would better equip the sector to partner with government on developing and implementing solutions that provide necessary support for businesses recovering from the economic impact of COVID-19.
Independent Sector stands ready to partner with government and private financial institutions to ensure all nonprofits eligible for SBA 7(a) PPP loans can receive the resources needed to continue providing critical, life-sustaining services for Americans.
Read today’s letter to the SBA here.
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Independent Sector is the only national membership organization that brings together a diverse community of changemakers, nonprofits, foundations, and corporations working to ensure all people in the United States thrive. Learn more at independentsector.org.
