How PPP loans missed the mark with Philly’s Southeast Asian business owners

Hor Chou wants a coronavirus business aid worker to go along South Seventh Street to gauge the need for the corridor’s storefronts.

Grocery stores, jewelry retailers, cafes, clothing stores and restaurants in Philadelphia’s Southeast Asian neighborhood are, like many local business districts, and -shocked during the early stages of the COVID-19 pandemic.

But even today, more than two years since the first outbreak, many of those businesses have not fully recovered.

When the federal government released hundreds of billions of dollars in aid as part of the Paycheck Protection Program, details slowly trickled down to Cambodian and Vietnamese local businesses.

“The information that is needed for survival, or the information that is needed for economic stability, is reaching our country too late,” Chou, owner of the New Happy Garden restaurant, said through Khmer. [Cambodian language] an interpreter.

Interviews conducted over a year with Asian American small business owners, community members, trail managers, and local government officials revealed barriers that hinder Asian American entrepreneurs/ Pacific Island (AAPI) monolith in Philadelphia to get a PPP loan or reduce. their process of obtaining financial aid.

The challenges range from language barriers and digital literacy to banking relationships and even cultural attitudes. In some cases, something as simple as not having an email address deprives a company of access to help.

Chou, head of the Cambodian American Business Community, estimates there are about 40 Southeast Asian-owned businesses in his corridor, which stretches from Jackson Street to Oregon Avenue.

In the numbered tract that covers Wolf Street to Oregon Avenue, the loan forgiveness will go to 14 different South Seventh Street businesses, a group that includes many independent contractors and sole proprietors, according to Metro Philadelphia data. , The Inquirer, and Resolve Philly compiled.

Irza Hajati, who lives in South Philadelphia, didn’t think twice about applying for a PPP loan.

She and her husband, Aditya Setyawan, immigrated to the United States from Indonesia 20 years ago, and they run a grocery store, Pecel Ndeso.

Pecel Ndeso prepares food for weddings, organizes events and delivers orders to customers in New York and Washington. Last summer, they participated in the Southeast Asian Market at FDR Park.

Hajati said she is working hard at her son’s online school during the pandemic to consider business assistance programs, despite Pecel Ndeso’s struggles. She focused on providing free meals to members of the AAPI community, previously through Kampoeng Indonesia and now with Gapura Philadelphia, the first Indonesian community the couple co-founded.

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“Another reason is because we don’t have a real business, like a hotel,” he said.

But the food business, established in 2004, is his full-time job, and PPP is open to homeowners and self-employed, despite the presence of bricks and mortar.

A joint data analysis between Resolve Philly, Metro, and The Question attempted to understand the distribution of PPP rents among AAPI businesses in Philadelphia.

But lenders aren’t required to collect or report racial or ethnic information about business owners to the federal government, meaning only one-quarter of the data can be used to determine exactly how many AAPI-owned businesses qualify. loan.

This means that data alone cannot show any difference in the greatest efforts to help businesses in this disease.

However, early PPP aid flows disproportionately into white communities, according to research by Robert Fairlie, an economics professor at the University of California Santa Cruz, and Frank Fossen, University of Nevada, Professor Reno.

Most of the funds from the first round of the program, in April 2020, went to businesses with long-term banking relationships or were sent through local financial institutions, they wrote. The distribution of small towns improved in the second round and improved significantly in the third round in 2021, when the Biden administration opened the PPP only to businesses with fewer than 20 employees for two weeks.

“Did taking that time off really make a difference? We don’t know,” Fairlie said in an interview. “We don’t know the answers to those questions.”

An analysis by Resolve Philly, Metro, and the Inquirer found that, locally, the number of loans, as well as the average loan amount, varied greatly for AAPI business owners based on whether the business was located in the whitest census tract. or multi-black.

In the majority of white population tracts, the median loan was more than $20,000 – and among the 10,472 loans that came out was more than $320 million. In tracts with the largest Black population, there were only 3,466 loans averaging about $19,165 and a total of $66 million.

Dan Tang, owner of Tang Pharmacy in Olney, a diverse area where 46% of residents, the majority, are black, said he believes the area is often under-resourced.

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“It’s like if you look at some pockets of the city, they’re growing,” he said.

Fern Rock Hardware, also in Olney, received about $5,000 in PPP funding, and owner Justin Lee, through a Korean interpreter, said he applied for only one of the program’s two funding rounds.

He explained that it would have been difficult to get through the process without the help of the North Fifth Street Revitalization Project, a neighborhood business group, and Noah Bank, a financial institution in Elkins Park that serves Koreans. information.

Other AAPI small business owners have not been as successful as Lee, mainly due to language barriers and technical challenges.

The country’s AAPI community is not one, multi-lingual and multi-ethnic.

“It’s not like Hispanics,” said Narasimha B. Shenoy, founder and president of the Asian American Chamber of Commerce of Greater Philadelphia. “They will only translate Spanish. We will do a lot more than that.”

Chou said details related to government programs are not available in Khmer, Cambodia’s most widely spoken language.

The ban has been extended to information about the disease, including the vaccine against COVID-19, according to Nary Kith, director of KITHS, Cambodia’s social services organization.

“People were afraid that if they contracted COVID, that was it,” he said. “That’s a death sentence.”

Even for languages ​​that are widely spoken in the United States, PPP guidelines do not exist in the first place.

James Wang, president and CEO of Asian Bank of Chinatown, said that the application is not available in Chinese easily until at least the middle of the first half of the loan.

He explained: “We have a lot of customers who don’t speak the language. “I think that, for one, is a big obstacle. And then for them to go online and get anything in English is very challenging.”

Elisa Kim, whose family owns T-House Inc., a screen printing business in Olney, said many of the neighborhood’s shoppers don’t have email addresses, a concern Kith, Shenoy and others said.

“With all these apps that require you to access email and to check your email all the time, that’s not something that some people are aware of,” said Lamei Zhang, former project manager for the Philadelphia Chinatown Development Corp.

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A lack of digital literacy prevented some businesses along South Seventh Street from having websites, let alone the sophisticated online ordering system that has become commonplace during the pandemic. Additionally, many businesses with AAPIs, especially mom and pop shops, have trouble getting financial statements and tax forms ready.

Even when they can find the documents, some business owners are reluctant to hand them over to the federal government or don’t want to ask for help, Shenoy said.

“They will not come out and ask for help. Only a few of them do it,” he said. “That’s tradition. It’s pride.”

“As you get closer to the grassroots level and you get closer to the smallest business model, the biggest hurdle for most people, I think, is trust,” said James Onofrio, program manager at the Philadelphia Department of Commerce.

Onofrio, who works with business managers, said some business owners are suspicious of government assistance, based on their experiences as refugees from Vietnam, Cambodia, Laos and Indonesia.

Although none of the business owners told Metro that the questioner personally experienced AAPI abuse or harassment, it is difficult to gauge how viral the behavior has become. affect money.

Shenoy added, referring to the number of epidemics affecting all small businesses and the anti-Asian mentality.

Community leaders say there’s a need to be more aware of the barriers facing AAPI business owners, perhaps especially because of the “role model” myth — the belief that Asian Americans do better in jobs and schools than others. other colors.

“I think this epidemic is a wake-up call to the city just to see where there are not enough opportunities, especially for the immigrant community,” said Stephanie Michel, executive director of Olney’s North Fifth Street Revitalization Project.

“It should be a priority to ensure that immigrants have access to information and money, especially when the world is falling, literally, and affecting business,” he added.

Julie Christie and Diana Lu contributed to this report.

Acceptance

This story is a collaboration of The Inquirer, Metro Philadelphia, and Resolve Philly and is made possible through the Future of Work program. The story grew out of the work of Resolve Philly’s Community Engagement Team.

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