In a letter to the acting heads of the Small Business Administration and Treasury Department today, the American Bankers Association raised several significant issues that have arisen since the PPP re-opened earlier this month. Specifically, ABA flagged that the PPP portal does not permit lenders to upload borrower applications for second-draw loans if the borrower still has a pending forgiveness application for a first-draw loan with SBA. Lenders have also reported receiving a high number of incorrect error messages when submitting PPP loan applications for the portal, ABA said.
Finally, the association flagged an issue related to documentation requirements to demonstrate a 25% revenue reduction for second draw loans, noting that many banks had completed borrower applications before SBA and Treasury released detailed guidance on what types of information would satisfy these requirements. ABA urged the agencies to clarify that borrowers and lenders may rely on the guidance at the time the loan application was received by the lender.