In Less Than Two Weeks, Paycheck Protection Program Direct Borrower Forgiveness Portal Surpasses Expectations, Accepts More Than 340K Submissions
SBA portal significantly outpacing top PPP lenders not utilizing the Agency’s direct forgiveness tool in forgiveness submissions
Since the opening of the Paycheck Protection Program (PPP) Direct Borrower Forgiveness Portal on August 4, the U.S. Small Business Administration has received more than 340,000 submissions from borrowers with PPP loans of $150,000 or less, highlighting Administrator Isabella Casillas Guzman’s priority of rushing relief to the smallest of small businesses and far exceeding expectations.
In providing its new, streamlined portal, the SBA is also executing the Biden-Harris Administration’s goal of centering equity in all programs. With outstanding debt saddling millions of disadvantaged and underserved small businesses, increasing the rate of forgiveness to PPP borrowers will have an immediate effect in helping the smallest of small businesses recover from the pandemic and access other resources. Prior to this option, businesses that did not apply for forgiveness within 10 months of the end of the covered period were at risk of owing principal and interest payments on their PPP loans.
“We are incredibly excited that in just two weeks, the Direct Borrower Forgiveness Portal is providing small businesses with a streamlined, user-friendly way to apply for forgiveness and receive relief on these essential PPP loans,” said Patrick Kelley, Associate Administrator for SBA’s Office of Capital Access. “Already, we’ve seen hundreds of thousands of borrowers navigating quickly and easily through the process, and we continue to proactively help borrowers apply through extensive outreach and webinar trainings. We encourage all lenders to opt-in to this tested portal.”
In the two weeks since the portal opened, the SBA has received over three times the number of submissions than the top 10 PPP lenders who are not participating in Direct Forgiveness, putting us on pace to close out forgiveness for the 3.4 million direct forgiveness borrowers by the end of the year. Currently, more than 1,230 PPP lenders, representing over 50% of outstanding loan forgiveness applications, have opted-in to the Direct Borrower Forgiveness Portal.
“The direct forgiveness platform has been very effective and efficient in processing applications from tens of thousands of our PPP borrowers already. This has been tremendously smooth for our borrowers, our institution, and for SBA,” said Chris Hurn, CEO of Fountainhead. “Our borrowers’ feedback has been universally positive about its ease of use in completing their applications within mere minutes. We’re very proud to have played a small part in helping make this a reality.”
Before direct forgiveness, borrowers had to take the initiative to download forgiveness forms or get forms from their banks to complete and submit. Some lenders had not yet built the technology or processes to even begin accepting forgiveness applications, and many did not actively reach out to borrowers to help them through the process. Forgiveness was not user-friendly, which is why millions of borrowers, including over 700,000 loans made in 2020, had yet to submit their one-page application.
Through this simpler process, SBA proactively reaches out to borrowers and provides a pre-populated forgiveness form to the borrower that they can complete in the new direct forgiveness portal. Borrowers can submit using a computer or smartphone. On average users submit their applications in only six minutes and receive their forgiveness decisions within a week from the date of submission. Of the 340,000 applications submitted through the portal, half have already been approved for full or partial forgiveness, totaling more than $2.4 billion.
Borrowers who are interested in starting their applications can access the portal here. The SBA also encourages interested borrowers to attend an upcoming live webinar and Q&A sessions:
Borrowers whose loans are through banks that have chosen not to opt-in to the SBA’s direct forgiveness portal must apply through their lender for forgiveness. To ensure that direct forgiveness relief goes to communities and small businesses with the most need, the SBA remains committed to reducing fraud across programs.
Article Courtesy of the SBA