7/28/2021
Candace J. Dixon
The U.S. Small Business Administration (SBA) launched a streamlined application portal to allow borrowers with Paycheck Protection Program (PPP) loans of $150,000 or less through participating lenders to apply for forgiveness directly through the SBA. Loans of $150,000 or less represent 93% of outstanding PPP loans, with approximately 7 million loans remaining to be forgiven. Many borrowers will have to begin making payments on these loans in the very near future.
“The SBA’s new streamlined application portal will simplify forgiveness for millions of our smallest businesses -- including many sole proprietors -- who used funds from our Paycheck Protection Program loans to survive the pandemic,” said Administrator Isabel Casillas Guzman. “The vast majority of businesses waiting for forgiveness have loans under $150,000. These entrepreneurs are busy running their businesses and are challenged by an overly complicated forgiveness process. We need to deliver forgiveness more efficiently so they can get back to enlivening our Main Streets, sustaining our neighborhoods and fueling our nation’s economy.”
The SBA PPP Direct Forgiveness Portal will help rush relief to 6.5 million of the smallest of small businesses, a priority of the Administrator from the beginning.
Lenders are required to opt-in to this program through https://directforgiveness.sba.gov. 600 banks have opted in so far, allowing 2.17 million borrowers to apply through the portal, which represents 30% of loans $150,000 or less that have not yet been submitted for forgiveness.
You can download a List of lenders participating in direct forgiveness for their PPP loans in Excel format.
After registering, borrowers will be able to use the portal to automatically submit their forgiveness request to their lender.
A live PPP customer service team will be available to answer questions and assist borrowers with their forgiveness applications at 877-552-2692, Monday through Friday from 8 a.m.to 8 p.m. EST.
The Interim Final Rule: COVID Revenue Reduction Score, Direct Borrower Forgiveness Process, and Appeals Deferment implementing changes related to the forgiveness of PPP loans became effective July 28, 2021. In addition to establishing a COVID revenue reduction score at the time of forgiveness to document the required revenue reduction for second draw PPP loans and establishing the direct-borrower forgiveness portal for lenders that choose to opt-in, the interim final rule also extends the loan deferment period for borrowers who file a timely appeal of final SBA loan review decisions with the SBA Office of Hearings and Appeals.
Paycheck Protection Program Summary
Established by the CARES Act in 2020, the PPP was among the first COVID-19 small business economic aid programs, providing 11.7 million loans worth nearly $800 billion in economic relief to small businesses and non-profits, helping to keep employees working and businesses to come back stronger than ever.
In 2021, 6.5 million loans were approved, totaling $275 billion, with an average loan size of $42,000, compared to $101,000 in 2020. 96% of the loans went to businesses with less than 20 employees, up from 87% in 2020. 32% of loans went to businesses in low and moderate income communities, compared to 24% in 2020.
Other available relief programs have included the Economic Injury Disaster Loan (EIDL), EIDL Advance, Targeted EIDL Advance, Supplemental EIDL Advance, Restaurant Revitalization Fund, Shuttered Venue Operators Grant, and SBA Debt Relief program.
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