White Skin is an Important Criterion to Get a PPP Loan: Black & White Test Applicants w/Similar Profiles were Offered Different products, info & encouragement to apply for loans from bank reps

From [HERE] White applicants for Paycheck Protection Program loans were treated better than Black applicants, according to a study by an activist group that fights discrimination.

The National Community Reinvestment Coalition sent Black and white testers with similar profiles to talk to banks about securing PPP loans to help their small businesses stay afloat during the coronavirus crisis. They found “different levels of encouragement to apply for loans, different products offered and different information provided by bank representatives.”

The study was conducted between April 27 and May 29 with 17 banks in the Washington, D.C., metropolitan area. The results are in line with patterns of disparities in lending before the pandemic hit. 

"The tests show that old patterns of systemic discrimination in lending didn’t magically disappear when banks made PPP loans," said Jesse Van Tol, CEO of NCRC. "Banks still have a long way to go to root out discrimination, and clearly they need better training for their employees and more testing to create internal checks and internal pressure to drive out racist practices.”

The government-backed loans were especially sought after because they can be forgiven as long as small business borrowers maintain their payrolls. The Trump administration says more than $520 billion in loans were given out and that about $130 billion remains uncommitted. [MORE]