What Restaurant Relief Is Ahead?

The Payroll Protection Program (PPP) has expired and many restaurant owners and operators are still in need of resources to remain in business. Modern Restaurant Management (MRM) magazine asked Kathryn Petralia, co-founder of Kabbage, for her insights on the next financial resources for restaurants.

What’s kind of financial help will be available next for restaurants?


The Payroll Protection Program (PPP) successfully helped millions of small businesses access critical funds during the crisis. We served the smallest of businesses, many of which couldn't apply for a PPP loan with long-standing banks, including restaurants which became one of the top five largest segments we helped. In the end, Kabbage became the second-largest PPP lender in the program by app volume as we helped nearly 300,000 access over $7 billion, preserving an estimated 945,000 US jobs. 


Now that the Payroll Protection Program has expired, businesses need to find new ways to drive demand, reinvent revenue streams and keep their companies progressing in the right direction despite the ongoing challenges facing our economy. Our data shows many businesses that received a PPP already have significantly reduced cash balances after taking the loan. That means the program worked for a time but now businesses are in the same, or worse, cash position as before. More funds will be needed if the economy remains idle and businesses are unable to reopen. We’re hoping Congress works through its differences and passes the HEALS Act which would allocate more relief funds for small businesses.

In addition to federal relief, cities and towns are finding new ways to support local businesses. Many cities in the US have allowed restaurants to take over parking lots, sidewalks and in some cases, entire streets, to allow outdoor dining. In other states, restaurants can resume indoor dining with reduced capacity and further safety precautions.

Creative solutions that allow restaurants to drive demand are imperative. We’d also love to see cities offer business forbearance, tax holidays, or programs that replicate the UK's successful "eat out to help out" initiative to provide further support. 

What resources should they turn to?

Many communities have private or government-led business grants, also national programs like restaurantscare.org and the SBA are additional resources to apply for business grants. 

Additionally, there are also technology solutions easily accessible to help small businesses better manage their cashflow.  For one, my company, Kabbage, offers small businesses free cash flow insights, contactless payments and business checking accounts which eliminate common fees in banking. Instead, we pay small businesses a 1.1 percent APY, one of the highest rates in the industry. Our products have no sign-up fees nor monthly fees, and all use automation and real-time data to empower small businesses to have the same financial savviness often found in larger businesses with bigger budgets and finance departments. These kinds of innovations can help small businesses that may have otherwise been forced to shut down.