SBA Launches Streamlined PPP Loan Forgiveness Program
Small businesses who took out PPP loans during the pandemic have a little bit of help on the way.
The U.S. Small Business Administration (SBA) recently announced that it is launching a program designed to simplify the loan forgiveness process for borrowers who took on Paycheck Protection Program (PPP) loans of $150,000 or less. The program will allow those borrowers to apply for loan forgiveness directly from the SBA, sidestepping the need to go through their specific lender.
“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 SBA administrator Isabel Casillas Guzman.
The new forgiveness program will be available starting Aug. 4, 2021. Eligible borrowers will receive a link in an email from the SBA that will take them directly to their loan forgiveness application. The application should take less than 10 minutes to fill out and submit.
Unfortunately, not every small business that took out a PPP loan for less than $150,000 can apply for loan forgiveness through this new program. First, the bank they borrowed from has to opt-in. The SBA is reporting that more than 600 lenders have already opted into the direct forgiveness program, giving more than 2 million borrowers access to the more efficient process.
“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,” said Guzman. “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.”
As part of this initiative, the SBA has also formed a customer service team to answer any PPP-related questions and directly assist borrowers with their loan forgiveness applications.
“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 the SBA’s Office of Capital Access. “We are pleased to assist financial institutions across the U.S. in processing forgiveness applications for small business owners.”