The third quarterly Camino Financial U.S. Latino Small Business Survey offers insight on the resurgence of COVID-19 and the reclosures of the economy between June 2020 to August 2020. Our Q3’2020 survey shows that Latino Owned Businesses (LOBs) with pre-existing lender relationships had a higher chance of receiving a PPP loan, with 16.5% of borrowers obtaining PPP funding vs. 2.5% of non-borrowers surveyed receiving PPP funding. Evidently, this shows that LOBs with a pre-existing lender relationship had a 6.6x higher chance of obtaining PPP funding, demonstrating the importance of technical assistance, education, and constant communication from a lender.
Camino Financial is sharing its proprietary data on the LOB segment to provide a baseline and track the economic development of this key demographic. The report is based on 32,940 small business loan applications received directly by Camino Financial and a separate survey of 368 LOBs relating to the impact of COVID-19 on Latino small business owners. The pandemic forced the majority of LOBs to close temporarily in 2020, and 46% saw a revenue decline of more than 30%. The findings indicate that LOBs need further capital injections to bolster the rebirth of their businesses during unprecedented economic uncertainty.
Other key insights from the survey include:
- LOBs are resilient. — 78% of LOBs have reopened and 44% have returned to pre-COVID revenue.
- LOBs are optimistic. — 70% of LOBs believe their business will be as good as or better than pre-pandemic levels.
- Further capital injections needed for rebirth — 60% of LOBs have less than four months of operating capital, including 21% with less than three weeks.
This survey will be followed by quarterly-issued U.S. Latino Small Business Surveys informed by Camino Financial’s loan application data. The report can be indicative of systemic macroeconomic trends within the larger U.S. Economy.