Lenders with less than $1B in assets debuted new PPP loans on Friday, an SBA push to help smaller programs. But large lenders start Tues., according to SBA and Treasury.
WASHINGTON – The U.S. Small Business Administration (SBA) in consultation with the U.S. Treasury Department re-opened the Paycheck Protection Program (PPP) loan portal to all PPP-eligible lenders today.
Smaller lenders – those with $1 billion or less in assets – could start making PPP loans Friday, saying the portal would fully open on Tuesday, Jan. 19, 2021.
SBA says it granted dedicated PPP access early to Community Financial Institutions (CFIs) – which include Community Development Financial Institutions (CDFIs), Minority Depository Institutions (MDIs), Certified Development Companies (CDCs), and Microloan Intermediaries – as part of its efforts to reach underserved and minority small businesses. Those lenders include community banks, credit unions and farm credit institutions.
While large lenders now have access to the PPP program and ability to offer loans, SBA says those smaller lenders will continue to have dedicated service hours.
“SBA has worked expeditiously to ensure our policies and systems are re-launched so that this vital small business aid helps communities hardest hit by the pandemic,” says SBA Administrator Jovita Carranza. “I strongly encourage America’s entrepreneurs needing financial assistance to apply for a First or Second Draw PPP loan.”
- First Draw PPP Loans are for borrowers who have not received a PPP loan before Aug. 8, 2020. The first round of the PPP, which ran from March to August 2020, helped 5.2 million small businesses and kept 51 million American workers employed, SBA says.
- Second Draw PPP Loans are for eligible small businesses with 300 employees or less that previously received a First Draw PPP Loan and will use, or have used, the full amount only for authorized uses. They must also demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020. The maximum amount of a Second Draw PPP loan is $2 million.
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