U.S. says $35 billion more in pandemic loans approved, trying to fix program snags By Reuters

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© Reuters. FILE PHOTO: Outbreak of the coronavirus illness (COVID-19), in New York City

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WASHINGTON (Reuters) – The U.S. Small Business Administration (SBA) on Tuesday stated it had accredited 400,000 more pandemic aid loans price $35 billion and was trying to fix points operational snags with the program raised by lenders.

The SBA launched the third spherical of the Paycheck Protection Program (PPP) this month, however important modifications to its guidelines, course of and know-how platform, has triggered issues that have been slowing approvals, a financial institution group stated on Tuesday.

Companies trying to apply for a second PPP mortgage have been encountering technical hurdles the American Bankers Association stated, whereas lenders are additionally receiving a “high number of incorrect error messages” once they submit mortgage functions.

Reuters reported this month that authorities officers had pressured massive lenders earlier to go dwell with the most recent spherical of the program regardless of many unresolved points.

The SBA stated on Tuesday {that a} assessment of first-time loans discovered anomalies – “mostly data mismatches and eligibility concerns” – in roughly 4.7% of the lender-submitted knowledge.

“These concerns will require follow-up between the lender and the borrower so that borrowers can access a second round of loans,” the SBA stated, including it could present steerage to assist lenders work by way of the issues they’re encountering.

Under the PPP, firms obtain loans from banks and fintech firms that might be repaid by the federal government if the cash is spent on eligible bills. Some $525 billion price of PPP loans have been made final 12 months through 5.1 million loans.

Congress expanded the program with one other $284 billion final month. It additionally modified the principles on who was eligible, what the cash might be spent, in addition to altering the method for submitting and approving loans.

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