The Small Business Association is making it easier for small businesses to apply for forgiveness of their Paycheck Protection Program loans. Instead of processing forgiveness applications with their lenders, borrowers who received under $150,000 in 2nd draw PPP funds can utilize the SBA’s new portal that officially launches Aug. 4th, 2021.
The SBA hopes their new portal will reduce the forgiveness application process to mere minutes for most business owners.
Who Can Use the Portal
Business owners with $150,000 or less in 2021 PPP loans (who have not already applied for forgiveness through their lender) are encouraged to use the SBA’s new forgiveness portal.
Lenders can also use the portal to batch upload forgiveness submissions if they have 500 or more to process at a time.
While lenders will still need to approve the submitted forgiveness applications, the SBA portal streamlines the process and removes the bulk of the burden from lenders and business owners alike.
Updates to Forgiveness Application
When using the portal to apply for forgiveness, borrowers have the option to skip the burden of proving a 25% revenue loss in 2020. Instead, borrowers can rely on something called a “COVID health score.” This new metric is an automatic score that combines data such as foot traffic and business-to-business expenditures in an area to validate a company’s revenue reduction over the time period in question. The score is based off public and proprietary data collected by Dun and Bradstreet’s Commerce Health Index.
If a business doesn’t automatically pass the COVID health score, the option to upload documentation of a 25% revenue loss is still available.
Forgiveness Process and Timing
For those who do decide to use the new SBA portal to apply for PPP forgiveness, the processing period is the same as it was for the first round of PPP funding and traditional loan forgiveness.
Lenders will need to opt-in to using the portal before a business owner’s application can be forgiven. As previously mentioned, the lender still needs to approve the loan forgiveness submission. Once an application is submitted, though, lenders have 60 days to decide to forgive the loan. The SBA then has 90 days to remit the funds to the lender. During this time, the borrower may be required to submit additional documentation to either their lender or the SBA to help the process along.
Questions on PPP forgiveness? Head to the SBA’s page on the PPP program. You can also reach out to us to answer any questions you may have regarding PPP Loan Forgiveness or any other COVID-19 relief programs.