SAN JOSE, Calif. (KRON) – The coronavirus pandemic has many small business owners and their employees struggling to make ends meet.
To make matters worse, there is a huge demand for small business loans and lots of red tape.
The recently passed Paycheck Protection Program is supposed to help small business owners but there is a huge demand for loans and a San Jose contractor says his bank won’t even accept his application.
Like hundreds of other small businesses across the region, San Jose’s Plateau Builders has shut down.
Its 15 employees are out of work and running out of money fast, says owner Jacob Brown.
“It’s really hard, we’re just used to producing and working and now we have the stress of making our mortgages and rent,” Brown said.
Brown says he approached his longtime bank, Wells Fargo, for a loan under the Federal Paycheck Protection Program but wasn’t even allowed to submit an application.
“We showed up on the first day and it was a no go, Wells Fargo basically said we’re not sure when it will be opened up but right now we’re not taking any applications,” Brown said.
It’s participation in the PPE Program has been limited because of sanctions imposed due to past rule-breaking but on Wednesday the federal reserve temporarily lifted those restrictions.
In a statement, Wells Fargo said it is looking forward to expanding relief to many more small businesses and nonprofits.
“I’m a client of Wells Fargo for 35 years, I have had this business for many years and I am worried about the families that I am not able to employ right now and also for myself,” Brown said.
The Paycheck Protection Program is supposed to be a lifeline for plateau builders and other small businesses but the red tape has people like Jacob Brown feeling like they’re being pushed to the back of the line.
“I just feel insecure, I feel like these big institutions would be there for us. It’s like a gut punch and made me go nuts. Right now, we’re going to try with other lenders, because of the process, not because of not being eligible or being turned down but just not getting a chance to process the loan,” Brown said.
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