The Small Business Administration will allow borrowers with Paycheck Protection Program loans of $150,000 or less to apply online for forgiveness directly from the agency, American Banker reported. Lenders will have to opt in to allow the SBA to process the applications, and they will still issue a decision on whether to grant forgiveness, according to rulemaking documents the agency issued to the industry Wednesday. The agency has not said when the portal might open. The initiative, which the SBA touted as a way to start closing down a program that launched in April 2020, was welcomed by banks that are still dealing with the cost of processing applications from borrowers who want forgiveness. Through May, banks had funneled nearly $800 billion in forgivable PPP loans to small businesses hurt by the COVID-19 pandemic. The Small Business Administration says that loans of $150,000 or less comprise 93% of the outstanding Paycheck Protection Program debt. The SBA said in its rulemaking documents that since last summer, it has received comments from borrowers and lenders stating that “the loan forgiveness process is overwhelming and difficult to manage.”
