The Small Business Administration has good news for PPP loan recipients: a new portal will soon be available for loan forgiveness applications. The portal will serve as an express lane for loan forgiveness decisions and is expected to be available to borrowers as early as August 4.
What does this mean for borrowers?
Instead of applying for forgiveness with the lender directly, businesses that have borrowed $150,000 or less will be able to apply for forgiveness through the SBA in a matter of minutes. The availability of the portal also means borrowers can expect to receive a quicker decision about whether their loan will need to be repaid.
What does this mean for lenders?
One of the primary goals of the portal is to alleviate the administrative burden lenders are facing as more borrowers are beginning to request loan forgiveness. This is significant, especially considering the 7.8 million outstanding PPP loans totaling approximately $385.4 billion.
Lenders must sign up to use the portal and establish an API connection with their internal systems, which may be a barrier for smaller financial institutions. However, the portal is expected to expedite application processing for 95 percent of PPP loans. This means lenders that have opted in to the portal will be able to focus on new loan applications instead of forgiveness applications.
The SBA will only handle processing the paperwork involved with the applications—all forgiveness decisions will ultimately fall to the respective lender. Lenders will also be responsible for handling all forgiveness applications for loans worth more than $150,000, as well as any applications that have already been submitted.