As the end of March looms near, the U.S. Senate approved a bill to extend the Paycheck Protection Program application deadline, moving it from Wednesday, March 31st until May 31st, 2021.
Here’s why the changes to the PPP timeline should be helpful for both borrowers and lenders. The PPP Extension Act of 2021, or House Resolution (H.R.) 1799 was approved with a large margin of support. Yet there was some debate about what this support should look like and how the extension should be administered. Sen. Marco Rubio, R-Fla, proposed an amendment to restrict the Small Business Administration (SBA’s) capacity to prioritize specific borrowers. The amendment was defeated by four votes.
What does an extra 60 days of the Paycheck Protection Program mean for borrowers? “It’s clear that the most vulnerable small businesses will need help beyond March 31, so we must pass this extension as quickly as possible,” said Sen. Cardin in a Thursday statement. “This common sense, bipartisan bill will meet the continued demand for PPP loans by giving small businesses two more months to apply and giving SBA an additional month to process the loan applications by June 30.”
The extra time for lenders to support the program is noted as an important provision of the extension. Associate Administrator for the SBA’s Office of Capital Access, Patrick Kelley testified during the Senate Small Business Committee meeting on Wednesday, March 24th. He noted efforts being made to resolve error codes and validation checks instituted by the SBA to prevent fraudulent applications from receiving funding. By his admission, over 190,000 applications are still being held up by routine error checks in the SBA’s PPP platform. By giving the SBA extra and necessary time to address a backlog of applicants held up by confusing validation and error codes and process delays, lenders are hopeful they can help borrowers work through the Program’s operational challenges and provide funding to their clients. “By providing small businesses with two more months to apply and giving the SBA an additional month to process applications, we will help ensure critical support isn’t cut off,” said House Small Business Committee Chairwoman Nydia M. Velázquez (D-NY) in a statement.
Loan Mantra continues to work with PPP clients. If you are a borrower seeking to participate in the U.S. SBA Paycheck Protection Program, start by filling out your portal on the Loan Mantra portal today!