Unforgiven PPP Loans to Small Business Total $28 Billion

unforgiven ppp loans total 28 billion dollars


Small businesses owe some $28 billion in debt as part of the Paycheck Protection Program (PPP). The lingering debt includes loans made to small businesses since 2020 as part of the COVID-19 relief package that hasn’t been forgiven.

The unforgiven debt is part of the more than $800 billion distributed over two years by the government to help small businesses keep afloat. The loans require small businesses to spend the money on payroll and other eligible expenses within a designated time frame.

$28 Billion in Unforgiven PPP Loans Still Outstanding

About 11.7 million uncollateralized, low-interest loans were provided amounting to over $790 billion. Of which around $673 billion has been forgiven, in full or in part, accounting for 82% (9.36 million) of all PPP loan forgiveness applications.

The Small Business Administration (SBA) and lenders have worked to provide over 11.7 million loans totaling nearly $800 billion in relief to over 8.5 million small businesses. Last year alone the SBA approved over 6.5M loans totaling over $275 billion. The average loan size was around $42 thousand to $101 thousand in 2020. Out of the total loans provided 96% of the loans had gone to businesses with fewer than 20 employees compared to just 87% in 2020.

However, the 28 billion debt burden continues to pose challenges to small businesses that have taken loans and are finding it difficult to pay back the loan. Small businesses that have seen recovery after receiving PPP loans include those in wholesale trade, manufacturing, and construction. While businesses that have been severely impacted by the pandemic and are experiencing a slow recovery, include those in transportation and warehousing, educational services, and arts, entertainment, and recreation.

Last year, payroll services firm ADP noted that small businesses lost more jobs in the spring but gained more since. And overall, in 2020 they lost 4.8 million net jobs compared to the 5.3 million jobs losses from large firms.

How PPP Loans are Forgiven

Millions of small businesses across the U.S. applied for and got loans through PPP.  Loans are eligible to be fully forgiven if businesses spend 60% of it on payroll as well as paying interest for mortgage, rent, and utilities. Small businesses that took out PPP loans can apply for forgiveness once all loan proceeds for which the small business is requesting forgiveness have been used.

They can apply for forgiveness any time up to the maturity date of the loan. If small businesses do not apply for forgiveness within 10 months after the last day of the covered period, then PPP loan payments are no longer deferred, and they will begin making loan payments to their PPP lender.

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Image: Depositphotos

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Samson Haileyesus Samson Haileyesus is a staff writer for Small Business Trends and has several years of progressive experience in media, communication and PR working with government, NGOs and private sector. He is passionate about public outreach, branding, media relations and marketing.

5 Reactions
  1. Si hola mi nobre es orlando mi pequeña enpresa esta muy afectada por causa del covi y resivi un prestamo del ppp pero el banco q me lo presto no me quiere dar la cordonacion del prestamo q devo de haser para solicitar q se me cordone ose se me de el perdon para seguir adelante con mi pequeña empresa

  2. We has small business owners, have never been assisted. From 2019, we pay Salaries, business running costs, rental etc. How is the government assisting us or banks. We small businesses just get ignored. It’s is abt time, we receive some sort of help. The government has these loans, which is long n drawn n it gets declined. Come government, help us small businesses. One frustrated business woman

  3. The ediel loan from SBA has been horrible..waiting 11 months, but yet a stripper or fake business gets it with no freaken Docs!