The Small Business Administration on July 28 issued new guidance that streamlines the process for millions of small businesses and nonprofit employers to have their Paycheck Protection Program loans forgiven.
The PPP was created last year to help small businesses and nonprofit organizations weather the COVID-19 pandemic. The program provided more than 11.7 million forgivable loans totaling nearly $800 billion from April 2020 through this May. The guidance issued by the SBA simplifies loan forgiveness for loans of $150,000 or less, which account for more than 90 percent of all outstanding PPP loans, the SBA said.
In its guidance this week, the SBA said it has notified banks that the agency is setting up its own online forgiveness platform that will accept applications from borrowers directly. In addition, the SBA will announce plans to spare certain borrowers who received second-draw PPP loans worth less than $150,000 from having to supply documentation proving that they suffered a 25 percent revenue reduction in 2020 that was a condition of the loans. The SBA plans to launch the site this week.