Description
In response to the COVID-19 pandemic, Congress created the Paycheck Protection Program (PPP) to stabilize businesses and their workers. Minority depository institutions (MDIs) – mission-driven lenders that serve marginalized communities – played a vital role in supporting small businesses through PPP lending. In this report, we document how MDIs outperformed non-MDI lenders in deploying PPP loans and loan dollars to minority and low-income communities.
Download Minority Depository Institutions: Paycheck Protection Program (PPP) Lending Insights
Published August 30, 2023
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Download Minority Depository Institutions: Paycheck Protection Program (PPP) Lending Insights
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Published August 30, 2023
The Early Bird Special ends on July 1, 2023.
Key Findings:
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119 MDIs collectively issued nearly 270,000 PPP loans and more than $16 billion in loan dollars. MDI participation in PPP lending was substantial across all MDI types.
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MDIs loaned money to all 50 states, Washington, D.C., Puerto Rico, Guam, the United States Virgin Islands, American Samoa, and the Northern Mariana Islands.
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The average MDI PPP loan dollar went to a zip code that had a poverty rate of 18% compared to 12.3% for non-MDI PPP loan dollars and the national poverty rate of 11%.
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79% of MDI loans went to minority or LMI communities versus only 47% of non-MDI loans.
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The median MDI PPP loan was $18,000 compared to the median non-MDI loan of $20,715.
Implications:
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This research demonstrates the importance of MDIs as first responders during times of economic crisis.
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Given their regular presence in underserved communities, MDIs are uniquely positioned to quickly deploy capital when it is needed most.
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Policymakers should continue to prioritize MDIs as key partners in implementing equitable fiscal policies and continue to drive capital to the sector so that the sector remains stable and well-positioned to expand and deepen its social impact.
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