In the latest version of the popular program, the SBA has partnered with a contractor to develop a whole new interface for banks. While it may seem smoother than before, Monday’s letter showed lenders experiencing a whole new set of technical issues.
The issue concerns applications for businesses that received OBP loans last year and are now applying for a second round of assistance, which was approved under the Economic Relief Act introduced in December.
Nichols said the application portal Paycheck Protection does not allow banks to submit second-loan applications if a business has previously applied for the first PPP loan, and the application is still pending with SBA. This is a problem because the rules of the program do not require that the initial loan be forgiven as a prerequisite to getting a second loan.
“This technical error results in the SBA not approving a significant number of second draw loans,” Nichols said in the letter. “We appeal to SBA to resolve this technical error and allow a lender to upload a loan’s second PPP loan application from the borrower, regardless of the status of the borrower’s application for forgiveness for the first time. loan.”
In the letter, Nichols said the banking group was trying to mark problems “that we believe are systematic and that you need immediate attention from your agencies to ensure that struggling small businesses can gain access to this important federal lifeline.”
He also expressed concern that borrowers receive a large number of incorrect error messages when supporting PPP loan applications through the SBA’s portal, including messages that contain incorrect loan restrictions, or that the first PPP loan from a borrower is under scrutiny. taken.
“In addition, attempts to gain clarity through credit providers through the portal’s messaging system have stalled,” Nichols said.
Spokesmen for the SBA and the Treasury did not immediately respond to requests for comment.