Newest Round of PPP Funding Faces Some New Technical Issues
New technical issues are plaguing the latest round of PPP funding, according to Rob Nichols, the President and CEO of the American Bankers Association. On Monday, Nichols wrote to the acting heads of the SBA and Treasury addressing them.
Though thousands of businesses are awaiting forgiveness, the SBA’s online portal is not allowing a second loan to be processed unless pending first-round forgiveness applications are marked as complete. This runs contrary to the official SBA rules that state a borrower can apply if they can prove they spent their first loan correctly by the time they get a second.
“We urge SBA to fix this technical error and permit a lender to upload a borrower’s second draw PPP loan application irrespective of the status of the borrower’s First Draw Loan forgiveness application,” Nichols wrote. “More broadly, lenders are receiving a high number of incorrect error messages when the lender attempts to submit PPP loan applications through the portal.”
Part of those errors come from confusion Nichols writes, between previous guidance handed out by the SBA and current stipulations. Funders are unclear as to why a $30,000 per employee loan cap exists or why some borrowers found that the documentation they prepared to prove a 25% reduction of revenue met requirements two weeks ago but don’t meet the criteria recently, Nichols wrote.Last modified: January 26, 2021
Kevin Travers was a Reporter at deBanked.