BOSTON, April 9, 2020 /PRNewswire/ -- In just the first few days of loan applications under the CARES Act, an Alignable/Harvard Business School (HBS) Survey and another Alignable poll point to serious obstacles to getting money into the hands of small businesses that need funds within the next few weeks to stay afloat.
According to a recent Alignable Pulse Poll of 31,800 small business owners in the U.S., nearly 67% say they haven't applied for the CARES Act loan yet. And the Alignable/HBS Survey of 5,800 small business owners revealed the reasons why:
- 31% say they distrust how loan forgiveness will be established and upheld by the federal government and/or the banks
- 29% assume they don't qualify
- 24% are concerned about timing: that the cash won't come soon enough or it won't last long enough to weather extended quarantines
- 10% think the process is too much of a hassle
Meanwhile, more than 33% of small business owners have applied for loans, but still wonder if or when they'll get their money.
- Only 1% have been approved
- Nearly 71% applied and are awaiting approval
- 3% were told they don't qualify
- And around 25% of them learned that their banks couldn't process applications yet
"While it's encouraging the government has earmarked $349 Billion for small businesses across the U.S. and federal officials are looking into additional funding, that's only part of the equation," said Eric Groves, Alignable.com's Co-Founder and CEO. "Engineering the infrastructure needed to quickly get this cash into the bank accounts of small business owners is what must be tackled right now, or we risk losing countless small businesses."
Alignable Co-Founder and President Venkat Krishnamurthy added, "It's apparent in a very short time that the banks and the government need to have a virtual meeting of the minds to give small business owners what they need to keep going, laying the foundation for an eventual recovery."
Additional statistics from the Alignable/HBS Poll demonstrate just how devastating the effects of the Coronavirus have been so far, as more than 43% of small businesses have temporarily closed already.
The hardest hit industries include: retail, arts and entertainment, personal services, food services, and hospitality. Less disruption is reported among categories including: finance, professional services, and real estate.
Despite its sobering findings, the Alignable/HBS Survey did indicate some strong optimism among small business owners for the end of this year. More than 90% of small businesses said they would be "at least somewhat likely" to be open in December 2020, with 64% saying it's "very or extremely likely."
The Alignable Small Business Pulse Polls and the Alignable/HBS Survey were conducted via email with a random sample of Alignable's membership database of 4.5 million+ small business owners. The Alignable/HBS Survey was administered by Harvard Business School professors and students, along with Alignable experts, from March 26, 2020 through April 5, 2020, collecting 5,800 responses from small businesses with 1-100 employees.
The Alignable CARES Act poll started on April 3, 2020 and has collected 31,800 responses to date. All respondents were small business owners with 1-50 employees.