A trio of national organizations representing bankers wants to see a faster, simpler loan forgiveness process for small businesses that have used the Paycheck Protection Program.
A streamlined process for forgiveness based on the size of the loan would greatly increase the efficiency of the popular program that was a key part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act (P.L. 116-136), and could enhance the PPP’s positive economic effect, said the groups. The American Bankers Association, the Bank Policy Institute, and the Consumer Bankers Association made their case in a July 17 letter to the Treasury Department and the Small Business Administration.
“As each day goes by, more and more borrowers are confronted with the need to use . . . lengthy forms, which takes a significant amount of time away from small business owners in running their daily business operations,” the groups said.
The letter notes that Congress has already made some changes toward making the program more accessible through the Paycheck Protection Program Flexibility Act (P.L. 116-142). That act, signed into law June 5, led to the creation of an “EZ” loan forgiveness application and a reworked loan forgiveness application.
But more can still be done, the groups argued. “The real need is for an expedited process based on a de minimis exemption for loans under a specific dollar amount,” the letter states.
The bankers observed that lawmakers have already proposed allowing PPP loans of $150,000 or less to be forgiven if the business provides a one-page attestation form from its lender, while other organizations have suggested setting the cap at $350,000.
An amount within that range “would be of great benefit to millions of small business owners” and is within Treasury and the SBA’s authority to implement, the groups said, urging the government to move quickly.
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