COLUMBUS (WCMH) — Tom Dailey says he has cashed out his own 401K savings account to try to save his chain of Zoup restaurants.
“I’m literally mortgaging my retirement to try to keep the business afloat and I think a lot of other business owners are in the same boat,” Dailey said.
Dailey applied for a loan through the Small Business Administration’s (SBA) Paycheck Protection Program (PPP). The loans are largely forgiven if the business keeps its employees on the payroll.
Congress approved $350 billion for the PPP as part of the coronavirus relief bill. Banks were flooded with applications and the money was gone in less than two weeks.
The SBA says 59,800 Ohio businesses received $14.1 billion in loans from the first wave of PPP funding.
Dailey applied for a loan for his soup and sandwich chain through Chase Bank. He did not receive one of the loans and was frustrated by what he says was a lack of communication from his bank.
“It’s extremely frustrating that a program with hundreds of billions of dollars that Congress clearly intended to help small businesses and the money’s not getting to small businesses,“ Dailey said. “It’s getting to larger businesses and it’s getting stuck in bureaucratic quagmires.”
In a statement, Chase said it had “secured more funding for small businesses than anyone else in the industry, and we’re fully prepared to help many, many more once additional funding is approved.”
The bank said 50 percent of the loans it funded were for less than $140,000 and more than 60 percent of its loans went to clients with fewer than 25 employees.
Congress is now debating a follow-up relief package that could include another $300 billion in funding for the PPP.
Dailey is not overly optimistic.
“There are hundreds of thousands of businesses just like us who are hanging by our fingernails,” Dailey said. “So we’re going to get through this but I’m not optimistic that the banks are going to be a big part of the solution.”