- U.S. Small Business Administration introduces direct forgiveness portal for Paycheck Protection Program borrowers with loans of $150,000 or less
- Borrowers can begin submitting applications on Aug. 4 as long as their lender has opted into the portal
- More than 600 banks have already signed on to allow smaller borrowers to directly submit applications
Summary by Dirk Langeveld
The U.S. Small Business Administration has announced the debut of a portal allowing Paycheck Protection Program borrowers with smaller loans to apply directly through the agency for loan forgiveness.
The direct forgiveness portal will begin accepting applications on Aug. 4. The SBA anticipates that more than 6.5 million PPP borrowers who took out a loan of $150,000 or less will be able to use the portal, although their lenders must opt in first. More than 600 banks have already done so, representing 2.17 million qualifying borrowers.
“The vast majority of businesses waiting for forgiveness have loans under $150,000,” said SBA Administrator Isabella Casillas Guzman. “These entrepreneurs are busy running their businesses and are challenged by an overly complicated forgiveness process. We need to deliver forgiveness more efficiently so they can get back to enlivening our Main Streets, sustaining our neighborhoods and fueling our nation’s economy.”
PPP approved 11.7 million loans totaling nearly $800 million to more than 8.5 million small businesses during three separate rounds of funding. The last round, which took place earlier this year, was concentrated on smaller businesses and loans. The average 2021 PPP borrower took out approximately $42,000.
PPP loans can be fully or partially forgiven if the borrower used the funds for approved purposes. At least 60 percent of the loan must have been used to maintain employee payroll and benefits, while the remaining funds could have gone toward other expenses such as rent or utilities.
The SBA has previously introduced measures aimed at helping sole proprietors and other PPP borrowers with smaller loans, including a simplified one-page forgiveness application for loans of $150,000 or less.
The SBA is also establishing a customer service team to answer questions and provide direct assistance on PPP forgiveness applications. Borrowers can contact this team between 8 a.m. and 8 p.m. EST on weekdays by calling 877-552-2692.