The Small Business Administration is making it easier for businesses to get their Payroll Protection Plan loans forgiven.
Officials plan to launch a PPP Portal that should speed up decisions on whether the still-outstanding loans will be forgiven or if businesses will need to repay them. At present, there are 7.8 million loans remaining, worth a total of $385.4 billion.
Rather than having to apply for forgiveness with their lender, many PPP recipients will now be able to work directly with the SBA. This will apply to loans of $150,000 or less, which make up 90% of PPP funds distributed. The streamlined process is designed to take just a few moments to complete.
The portal will go live to loan recipients on or around Aug. 4.
Lenders will still have a say in whether the debt is converted to a grant, even though not all banks are participating in the portal. The idea, though, is to reduce the workload burden on financial institutions.
Additionally, borrowers who received a second loan (worth under $150,000) this year will no longer have to supply documentation showing they suffered a 25% revenue reduction in 2020. The SBA will instead determine eligibility on other factors.
“All of us want to be done with forgiveness—borrowers, lenders, government—by the fall, across the board,” SBA Associate Administrator Patrick Kelley said in a webinar Tuesday. “This is the final push that will hopefully put PPP in the rearview mirror for the borrowers, for the lenders, and for the agency.”
The PPP program kept many businesses afloat during the pandemic, but was still riddled with fraud. The House Select Subcommittee on the Coronavirus Crisis found last October that loans went disproportionately to large businesses and borrowers that already had relationships with big banks.
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