The U.S. Small Business Administration, in consultation with the U.S. Treasury Department, will re-open the Paycheck Protection Program loan portal to PPP-eligible lenders with $1 billion or less in assets for first- and second-draw applications Friday, Jan. 15.
The portal will fully open on Tuesday, Jan. 19, to all participating PPP lenders to submit first- and second-draw loan applications to the SBA.
Earlier in the week, SBA granted dedicated PPP access to Community Financial Institutions (CFIs) which include Community Development Financial Institutions (CDFIs), Minority Depository Institutions (MDIs), Certified Development Companies (CDCs), and Microloan Intermediaries as part of the agency’s ongoing efforts to reach underserved and minority small businesses.
On Friday, SBA will continue its emphasis on reaching smaller lenders and businesses by opening to approximately 5,000 more lenders, including community banks, credit unions, and farm credit institutions. Moreover, the agency also plans to have dedicated service hours for these smaller lenders after the portal fully re-opens next week.
“A second round of PPP could not have come at a better time, and the SBA is making every effort to ensure small businesses have the emergency financial support they need to continuing weathering this time of uncertainty,” said SBA Administrator Jovita Carranza. “SBA has worked expeditiously to ensure our policies and systems are re-launched so that this vital small business aid helps communities hardest hit by the pandemic. I strongly encourage America’s entrepreneurs needing financial assistance to apply for a First or Second Draw PPP loan.”
”The PPP is already providing America’s small businesses hardest hit by the pandemic with vital economic relief,” said Secretary of the Treasury Steven T. Mnuchin. “As the program re-opens for all first- and second-draw borrowers … the PPP will allow small businesses to keep workers on payroll and connected to their health insurance.”
First Draw PPP Loans are for those borrowers who had not received a PPP loan before Aug. 8, 2020. SBA officials called the first round of the PPP, which ran from March to August 2020, a “historic success,” pointing out it helped 5.2 million small businesses keep 51 million American workers employed.
Second-draw PPP Loans are for eligible small businesses with 300 employees or fewer that previously received a First Draw PPP Loan and will use or have used the full amount only for authorized uses, and that can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020. The maximum amount of a Second Draw PPP loan is $2 million.
Meanwhile, the SBA said in a release this week it has already forgiven more than 1.1 million Paycheck Protection Program loans for over $100 billion, providing what officials called “an extraordinary amount of critical relief” to America’s small businesses just three months since the earliest PPP borrowers’ covered periods ended.
“Today’s news is a key indicator that the PPP is working for all small businesses across our Nation,” SBA Administrator Jovita Carranza said. “For any eligible small business continuing to struggle due to the coronavirus pandemic, the program has re-opened for new and certain existing PPP borrowers, and we encourage you to take advantage of the PPP to keep your workers on payroll, regardless of any local economic restrictions on your operations. SBA is continuing to work around the clock to forgive existing PPP loans and implement the next phase of this vital Program.”
The SBA has so far received more than 1.3 million forgiveness applications for approximately $170.5 billion. SBA has made payment on nearly 85% of the applications, forgiving over $100 billion. For the smallest borrowers with loans up to $50,000, 88% have been approved for forgiveness.
The new data comes as the Paycheck Protection Program has recently re-opened as a result of the Economic Aid to Hard Hit Small Businesses, Nonprofits and Venues Act, signed into law by President Trump on Dec. 27, 2020. The act added operational expenditures, certain property damage costs, supplier costs and worker protection expenditures, such as drive-through areas, ventilation and sneeze guards, as eligible expenses as well.
The SBA provides PPP Forgiveness Submission & Payment Metrics, as well as Paycheck Protection Program reports, online at www.sba.gov/ppp.