The Small Business Administration (SBA) has signed a deal with Amazon to build a new web portal to process applications for the $349 billion Paycheck Protection Program (PPP).
The program, aimed at supporting small businesses to pay staff and meet operational costs through the COVID-19 coronavirus pandemic, has been hit with technical issues since it launched last week.
Multiple news sources have reported that the SBA has struggled to cope with the huge demand for the support loans. Its system for processing applications, known as E-Tran, crashed several times on Monday, according to CNN, delaying banks’ ability to complete loan applications.
The deal with Amazon Web Services – the internet giant’s cloud computing business – means the launch of a new online portal for PPP loans at connect.sba.gov. The SBA has also introduced a hotline for those experiencing problems with E-Tran.
Meanwhile, US lawmakers are pushing for an additional $250 billion in support for small businesses through the pandemic, on top of the $349 billion already pledged as part of the wider $2 trillion stimulus signed into law late last month.
Treasury secretary Steven Mnuchin urged Congress to pass the PPP top-up yesterday, according to the Washington Post.
Mitch McConnell, the Senate Majority Leader, said he hoped to approve further funding for the PPP today after talks with Senate Minority Leader Charles Schumer, the Post reported.
Rob Nichols, CEO of the American Bankers Association, said: “Despite early difficulties with this unprecedented SBA lending program, banks of all sizes are actively accepting PPP loan applications and trying their best to deliver these funds to small business customers as quickly as possible.
“By approving additional funding right away, the administration and Congress can reassure more small businesses that they will be able to benefit from this financial lifeline.”
Some of the US’s biggest banks are already at capacity following a wave of applications, including Wells Fargo – which is also hampered by limits on its lending placed on it by regulators.
Meanwhile, the Federal Reserve has promised to establish a facility to purchase PPP loans, details of which will be announced this week.
According to a poll conducted by Alignable, a network for small businesses, the negative effects of the pandemic are impairing the livelihoods of 90% of small business owners across the US and Canada.
More than one-third of business owners said they had only a couple of weeks of cash to sustain them, Alignable reported.
A separate survey by the Federal Reserve Bank of New York – conducted during the second half of 2019 – found that 17% of small businesses would be forced to close if they lost out on revenues for two months.
Alignable’s ongoing poll – which has had 217,000 responses to date – identified Alaska, Rhode Island and the District of Columbia as the worst-affected states or provinces.
However, the survey has also found that 60% of businesses are receiving support from their local communities from networking groups, customers, and peers.
Tagged under Business Credit, Bank Performance, The Economy, Human Resources, Feature, Management, Financial Trends, Compliance, People, Performance, Customers, Core Systems, Online, Compliance Management, Community Banking, Feature3,
- PPP: SBA Issues Guidance on Changes in Ownership and Full Forgiveness Eased for Smaller Loans
- First Citizens, CIT Plan Merger to Create $100bn Bank
- OCC Levies Third Major Fine This Month
- ABA Urges DoJ to Update Market Data to Help M&A Governance
- JP Morgan Chase Outperforms, Good Sign for the Banking Industry