- U.S. Small Business Administration says more than 340,000 applications have been submitted to its Direct Borrower Forgiveness Program in its first two weeks
- Average borrower with a loan under $150,000 can complete forgiveness application in six minutes and get a decision within a week
- Portal aims to provide a more user-friendly way for borrowers with smaller PPP loans to receive forgiveness and avoid principal and interest payments
Summary by Dirk Langeveld
The U.S. Small Business Administration has released the initial data on its Direct Borrower Forgiveness Portal, saying the average Paycheck Protection Program borrower was able to complete their forgiveness application in six minutes and receive a decision within a week.
Since the portal opened on Aug. 4, the SBA has accepted more than 340,000 applications from PPP borrowers whose loans were $150,000 or less, and forgiven $2.4 billion.
The SBA says the portal has received more than three times as many submissions than the top 10 PPP lenders who are not participating in the portal, and encouraged lenders that have not opted into the portal to do so. More than 1,230 lenders are participating in the portal, representing over half of all PPP loans where loans are outstanding.
- The SBA described the previous forgiveness process as “not user-friendly,” since borrowers had to take the incentive to seek forgiveness, lenders did not always reach out to borrowers to encourage them to apply for forgiveness, and lenders had sometimes not established the technology or processes necessary to process forgiveness applications
- With the Direct Forgiveness Borrower Portal, the SBA does direct outreach to qualifying borrowers and provides a pre-populated forgiveness form that borrowers can complete via smartphone or computer
- The portal seeks to provide more equity in SBA programs and to ensure that small businesses are able to apply for forgiveness within 10 months of receiving their loan so they are not saddled with principal and interest payments
- The SBA is hosting webinars on the portal at 2:30 p.m. on Aug. 19, Aug. 26, and Sept. 2