The Biden administration vowed on Monday to improve communications with lenders as the Small Business Administration and financial institutions try to process thousands of loans from the Paycheck Protection Program.
“The goal of the SBA is to make it easier for lenders to provide PPP loans and to continue the relationship with this wider network of loan partners to expand access to capital after the PPP,” the administration said at the time. she made changes to the PPP process.
The SBA also announced that from Wednesday and 14 days after that, only companies with fewer than 20 employees may apply for PPP loans. They said 98% of small businesses have fewer than 20 employees.
“These companies often have more difficulty than larger companies to gather the necessary paperwork and get help from a lender,” the administration said. “The exclusive 14-day application period allows lenders to focus on serving these smallest businesses.”
Administration officials said in an effort to improve the PPP process, the SBA has organized phone calls with over 6,000 attendees and met with financial trading groups in recent weeks to better understand the issues with the PPP lending process.
Members of Congress and others reported one last year significant amount of waste, fraud and abuse in the PPP programAdministration officials said they now check SBA fraud records, the Treasury Department’s “Do Not Pay” database and other public records before approving a loan. They said that while there may no longer be “immediate approval” of loans, more than 96% of loan applications are approved within 48 hours.
Administration officials said they are also setting up a $ 1 billion PPP fund for sole proprietors, independent contractors and self-employed people.
The administration has announced several other changes to the PPP program, including:
- Small business owners with previous convictions for non-fraud crimes are now eligible for loans.
- Small business owners who are overdue on their student loan are also eligible for PPP loans.
- Small business owners who are non-citizens and legal residents of the US can use an individual tax number to qualify for a loan.
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