PayPal, Intuit, Square Get Approval To Give Loans To Small Businesses As Part Of $2T Federal Coronavirus Relief Package

Several financial technology companies have won the federal approval to grant loans to small businesses eligible under the government's $2T novel coronavirus (COVID-19) relief package.

What Happened

PayPal Holdings Inc. PYPL, Square Inc. SQ, and Intuit Inc. INTU all received their approval between Friday and Monday, TechCrunch noted earlier.

The fintech companies had been lobbying for the approval for weeks, as noted by TechCrunch.

PayPal CEO Dan Schulman said in a statement Friday that the company had already issued its first loan under the program, and more were expected "to be issued in the coming days."

Intuit similarly received the approval on Friday, and the loans are being offered through subsidiary QuickBooks Capital.

The financial services company also offers a tool to help small businesses and self-employed people assess how much assistance they're eligible for, under the program, TechCrunch noted.

Square was the latest to receive the approval on Monday and has said it will start accepting the applications next week.

Why It Matters

The federal government dedicated $350 million in loans to small businesses impacted by the pandemic, but the banks have been unable to match the number of claims filed under the United States Small Business Administration's Paycheck Protection Program.

The number of coronavirus cases has topped 582,594 in the U.S. at press time, making it the worst-affected country by far.

Small businesses are particularly seeing the impact of the economic fallout as they fail to keep their payroll at a time when they're seeing little to no customers, especially those working in travel, hospitality, and related industries.

Private companies, including Amazon.com Inc. AMZN and Facebook Inc. FB, have also announced plans to fund small businesses to help them survive the pandemic.

Price Action

PayPal shares closed 0.1% higher in the after-hours session at $105.98 and were unchanged in the after-hours session.

Square shares closed 0.4% higher at $59.42 and added another 1% in the after-hours at $60.

Intuit closed 0.8% lower at $250.09 and dropped another 0.3% in the after-hours at $249.34.