SBA offers PPP loan forgiveness

The U.S. Small Business Administration is launching a streamlined application portal to allow borrowers with Paycheck Protection Program (PPP) loans under $150,000 through participating lenders to apply for forgiveness directly through the SBA.

“With the new simplified application portal, thousands of businesses, and even sole proprietorships that borrowed PPP funds will have a streamlined process for having these funds forgiven said Janita R. Stewart, Acting SBA Region IV Administrator. “Most southeastern entrepreneurs waiting for forgiveness have loans under $150,000. It was time we made the process more efficient so businesses can get back to sustaining our communities. I am thankful for the SBA lenders who have agreed to participate in this new forgiveness system.”

This new change will help rush relief to over 6.5 million smallest of small southeastern businesses. The new forgiveness platform will begin accepting applications from borrowers on August 4^th.  Lenders are required to opt-in to this program through https://directforgiveness.sba.gov. In addition to the technology platform, the SBA is standing up a PPP customer service team to answer questions and directly assist borrowers with their forgiveness applications.  Borrowers that need assistance or have questions should call (877) 552-2692, Monday – Friday, 8 a.m. – 8 p.m. ET.

“This initiative will allow PPP borrowers to put their concerns of achieving full forgiveness behind them and focus on operating and growing their businesses again,” said Patrick Kelley, Associate Administrator for SBA’s Office of Capital Access. “We are pleased to be able to assist financial institutions across the U.S. in processing forgiveness applications for small business owners.”

Paycheck Protection Program Summary

• Overall, the SBA and lenders have worked to originate over 11.7 million loans totaling nearly $800 billion in relief to over 8.5 million small businesses.

In 2021:

• • SBA approved over 6.5M loans totaling over $275B
  • The average loan size was ~$42 thousand (compared to $101 thousand in 2020)
  • 96% of loans went to businesses with fewer than 20 employees (compared to just 87% in 2020.)
  • 32% of loans went to businesses in LMI communities (compared to just 24% in 2020)

Direct Forgiveness Summary

• Over 600 banks have opted into direct forgiveness, enabling over 2.17mm borrowers to apply through the portal (This represents 30% of loans $150,000 or less that have not yet submitted for forgiveness)

 

Established by the CARES Act in 2020, the PPP was among the first COVID-19 small business economic aid programs. It provided more than $798 billion in economic relief to small businesses and nonprofits across the nation, keeping employees working, and helping businesses come back stronger than ever.

Other programs include 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. To learn more about these programs, please visit www.sba.gov/relief.