Alert: SBA and Lenders Announce Steps to Improve Paycheck Protection Program
February 12, 2021
Disclaimer: This information was correct at the time of publication; however, new guidance from government agencies may be issued at any time, causing some or all of this information to change. Please visit our COVID-19 Business Strategy Hub for the latest news and ensure you are subscribed here to receive email alerts as they are released. We are working diligently to provide the most current information as it becomes available under our COVID-19 Actionable Insights For Businesses Series.
On February 10, 2021, the U.S. Small Business Administration (SBA) announced that they will be working with lenders to take steps to improve the Paycheck Protection Program (PPP). The announcement was presented in Release Number 21-15, which outlines steps that will help small businesses access much-needed PPP funds to persevere through the pandemic. The main goals of the improvements are to increase equitable access to underserved small businesses, to assure the program’s integrity, and to promote the rapid and efficient distribution of funds.
The SBA has outlined three steps to improve the speed of resolving data mismatches and PPP eligibility concerns. These changes will give small businesses more time to access much needed PPP funds. The three changes will:
1) Enable lenders to directly certify the eligibility of borrowers for first-draw and second-draw PPP loan applications with validation errors. This step will help ensure businesses who need funds and are eligible receive them as quickly as possible.
2)Allow lenders to upload supporting documentation of borrowers with validation errors during the forgiveness process.
3)Create additional communication channels with lenders to assure the SBA is continually improving the program’s equity, speed and integrity. This step includes the SBA hosting an immediate national lender call to brief lenders on the SBA platform’s added capabilities.
As of this week, the SBA announced that in the latest round of the program, it has approved $104 billion of PPP funds to more than 1.3 million small businesses. Of these loans, 82% are for less than $100,000, 28% of small businesses receiving loans are from rural communities, and the program has increased partnerships with Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs) who are trusted agents in extending economic relief to minority communities and underserved populations.
If you have additional questions about the latest round of the PPP, our PPP loan consultants are here to help. We can assist with applications for first- or second-draw PPP loans and PPP loan forgiveness calculations. Contact us for more information.
