Yesterday the SBA came out with new rules and forms to support the recent Biden administration changes to the program.  Here are three key takeaways:

  • The smallest of businesses – the self-employed - can now get substantially more relief. Their PPP amount will now be based upon their income, instead of their profits.  While this will cause confusion in the field as banks race to put new processes in place, it will help many.  This is the opportunity.
  • Many businesses that have already gotten their second round of PPP are not happy with this news.  There is no process or system for them to adjust their loans and reapply for the new amounts.
  • The fear is for those who applied for PPP loans of greater than $150K.   Under the new rules, certain borrowers will have to retroactively prove the necessity.  More SBA loan reviews and audits are in the future.

Keep in mind that the current round of PPP ends on March 31st and is fully expected to not use all the allocated funds.  Will the program be extended?  I don’t have a crystal ball – but at some point, we need to put it to rest, and focus the lender community resources on helping companies with long-term growth and investment.