Paycheck Protection Program

Though hopeful for a second-half bounceback in the economy, JPMorgan Chase is prepared for 20% unemployment, lackluster GDP and losses in its loan portfolio that could reach tens of billions of dollars.

By helping borrowers now, banks hope customers can quickly catch up on payments once the coronavirus pandemic ends. If they can’t, interest income will remain low and charge-offs could pile up if the crisis drags on.

PayPal, Intuit QuickBooks Capital and Square Capital have been named direct lenders in the Paycheck Protection Program, and more await the go-ahead. They could be crucial to reaching the smallest firms trying to survive the economic toll of the coronavirus pandemic.

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Bank of America, which came under fire for prioritizing applications from existing small-business customers, asked a federal judge in Baltimore to reject a request in a lawsuit to temporarily bar it from employing the practice.

The week-old Paycheck Protection Program will be opened up to sole proprietors and independent contractors on Friday.

Midsize businesses and state and local governments are among the beneficiaries of the central bank's latest $2 trillion effort to mitigate the economic damage caused by the coronavirus pandemic.

Many banks were hitting their limits for lending to small businesses devastated by the coronavirus outbreak. They say the Fed's decisions to help fund additional loans and relax capital requirements will resolve many of their problems.

The Fed's actions are designed to ensure the flow of credit to midsize businesses and state and local governments hit hard by the economic impact of the coronavirus pandemic.

The agency overhauled its system for the Paycheck Protection Program on Wednesday. Lenders hope it addresses the access issues and a crash that bedeviled the effort’s first week.