SMEs Seeking PPP Loans Frustrated With Problems


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The U.S. Paycheque Protection Program (PPP), renewed this year after Congress finally passed a stimulus package, has been hampered by a series of problems, The New York Times reported.

Martha Theirl, trying to get a PPP loan for her physiotherapy business in Massachusetts, spent hours struggling with three levels of customer service at her bank. “It’s been a nightmare,” she says.

The sources of business problems getting loans range from typos and technology glitches to anti-fraud software issues and inaccuracies in government documents. These problems have created roadblocks for U.S. businesses in need of relief amid the impacts of the COVID crisis.

A big problem: Thousands of people have been turned away because they mistakenly registered as having a recent criminal conviction.

The newspaper reported that Theyl applied for a PPP loan from Bank of America last month, only for the financial institution to cancel its request last Thursday (February 18). After a Times reporter contacted the bank, a loan officer called her the next day and told her there had been a mistake.

Now Theyl is hoping the loan will be approved soon.

The Biden administration announced on Monday February 22 that for a 14-day period starting Wednesday February 24, only companies with less than 20 employees will be allowed to apply for PPP loans. The overall goal is to help small businesses, those in underserved communities and those belonging to minorities gain increased access to the program.

In addition, the Small Business Administration (SBA) will make it easier for individual owners and the self-employed to obtain loans. In general, the PPP allows companies with up to 500 employees to apply.

the PPP has been an important part of the stimulus aid approved by Congress in response to the health and economic crisis of COVID-19. The federal government relaunched the program in January after Congress passed a stimulus package long delayed the previous month.

Forgivable loans, intended for small businesses, are made by financial institutions and supported by the SBA. The aim is to respond to criticism of the program and ensure that small businesses are not squeezed out by larger ones.

The Times said that, so far, this second round of the PPP has distributed $ 134 billion in emergency aid through banks to 1.8 million small businesses.

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