SBA simplifies process to get PPP loans forgiven
Thanks to a new, simplified process initiated by the Small Business Administration, it’s easier for restaurant operators who borrowed $150,000 or less to apply for Paycheck Protection Program Loan Forgiveness.
In its first two weeks—it launched July 28—the PPP Direct Forgiveness Portal program forgave more than $2.4B in PPP loans, relieving many restaurants of major debt. The National Restaurant Association supported the SBA’s effort to streamline the task with a series of webinars and fact sheets that helped operators understand how to manage the process easily.
Forgiveness in reach for more than 3.4M this year
Currently more than 1,230 PPP lenders, representing more than 50% of outstanding loan forgiveness applications, have opted-in to the Direct Forgiveness Portal, and the SBA is on pace to forgive loans for 3.4M direct borrowers by year-end.
Prior to this direct system, borrowers had to take the initiative to download forgiveness forms or get the forms from their banks. Some lenders hadn’t yet built the technology or processes to begin accepting forgiveness applications, and many didn’t actively reach out to borrowers to help them through the process.
Forgiveness was essentially not user-friendly, which is why millions of borrowers, including recipients of more than 700,000 loans made in 2020, hadn’t submitted their one-page applications, according to the SBA.
This simpler process allows the SBA to proactively reach out to borrowers and provide them with pre-populated forgiveness forms that they can complete through the portal on a computer or smartphone.
According to the SBA, on average, users submit their applications in about six minutes and receive their forgiveness decisions within a week from the date of submission.