The latest Paycheck Protection Program loans are doing what the government said they wanted to do: Get to an underserved community of small businesses, according to statistics released by the U.S. Small Business Administration this week.
Government officials said the SBA and lenders in the PPP program are “taking more strides” to improve the PPP so that “small businesses can access much-needed PPP funds” to persevere through the COVID-19 pandemic, “recover and build back better.”
In a release, officials said the Biden administration is working with the agency to “increase equitable access to underserved small business, to assure the integrity of the program and to promote rapid and efficient” distribution of funds.
“We are pleased that the Paycheck Protection Program is targeting the smallest of small businesses and providing economic relief at a crucial time in American history,” said SBA Senior Advisor to the Administrator Michael Roth.
This week, the SBA hit a major milestone of approving $104 billion of PPP funds to more than 1.3 million small businesses. Highlights from this round include:
- Reaching more of the smallest businesses; 82% of all loans going to businesses requesting less than $100,000.
- Reaching rural communities in a meaningful way; 28% of businesses who have received funding this round are in rural communities.
- Increasing partnerships with Community Development Financial Institutions (CDFIs) and Minority Depository Institutions (MDIs) who are trusted agents in extending economic relief to minority communities and underserved populations
The SBA is also following through on its commitment to take additional steps towards improving the speed to resolve data mismatches and eligibility concerns so that small businesses have as much time as possible to access much needed PPP funds, while maintaining the integrity of the program.
Three important changes will:
- Enable lenders to directly certify eligibility of borrowers for First Draw and Second Draw PPP loan applications with validation errors to ensure businesses who need funds and are eligible receive them as quickly as possible.
- Allow lenders to upload supporting documentation of borrowers with validation errors during the forgiveness process.
- Create additional communication channels with lenders to assure we are constantly improving equity, speed, and integrity of the program, including an immediate national lender call to brief them on the Platform’s added capabilities.
Staci Rewalt-Kolasa, a CPA and senior tax manager with DKSS CPAs + Advisors in Troy and St. Clair Shores, Mich., said lenders servicing their clients in this round of PPP loans are “much more knowledgeable and efficient” in the PPP loan application process than in the past.
“In many cases, no documentation is required to be uploaded at the time of application, which makes the process much smoother and faster,” Rewalt-Kolasa said. “The process still differs from bank to bank, though. Some banks require documents that the SBA is not requiring for PPP2 applications.”
Businesses that didn’t apply for a PPP loan the first time around still can, she said. Applications for both phases of the PPP program are due March 31.
The SBA’s Roth said officials are “excited” to be doing a better job of “reaching the hardest-hit industries and communities.”
“We are committed to taking additional steps to ensure that there is equitable access for underserved businesses and that we are leading with empathy to support small businesses in a difficult spot,” Roth said.
Through SBA’s 68 district offices, the Agency will work in close partnership with the Biden-Harris Administration to further leverage its resource partner network and expand on multilingual access and outreach about the PPP. Updated PPP information, including forms, guidance, and resources can be found at www.sba.gov/ppp and www.treasury.gov/cares.