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There are some pretty massive problems with the government& #39;s program to help prop up small businesses and keep workers employed. The @SBAgov folks are making a Herculean effort to fix their technology and update their documents, but it& #39;s slow going https://www.nytimes.com/2020/04/07/business/coronavirus-ppp-small-business-aid.html">https://www.nytimes.com/2020/04/0...
Check out what @StacyCowley @dmccabe and I found about how the program is working. Even after the SBA provides an authorization number for a loan, it could be days -- at least -- before actual $$ goes out to borrowers from some banks.
Bankers we talked to said it was unreasonable for anyone to think a program this massive could get going -- with money actually reaching business owners -- within a week. No matter how hard it is, though, they& #39;re still trying. There& #39;s a little bit of progress every day.
Some issues that remain:
-SBA& #39;s online portal only lets bankers enter borrower information one loan at a time. Imagine having to do that -- in Bank of America& #39;s case, for instance -- hundreds of thousands of times while only a few employees at each bank have access to the portal
-SBA& #39;s online portal only lets bankers enter borrower information one loan at a time. Imagine having to do that -- in Bank of America& #39;s case, for instance -- hundreds of thousands of times while only a few employees at each bank have access to the portal
-Not every bank is comfortable with the paperwork the SBA is providing to ensure that a loan is guaranteed by the agency. They are worried if they don& #39;t do everything right or if the SBA changes something later they& #39;ll be on the hook for lots of $$ - a big risk for them.
Other banks intend to hand out as much money as they can until they reach a limit to the volume of loans they can hold on their balance sheets. Normally they would sell these loans, but the market for them hasn& #39;t been created yet. Another factor keeping $$ out of borrowers& #39; hands
I& #39;m also still hearing from a ton of would-be borrowers who haven& #39;t even had the chance to submit a full application for a PPP loan yet. Some don& #39;t have an existing relationship with a lender doing SBA loans. Others are @WellsFargo customers who& #39;ve been shut out by its asset cap
The thing that makes me really sad is the worry I hear in people& #39;s voices that they are not going to get help after all, that the money for the program will be all gone by the time they get to apply for a loan. So one good development today has been the talk of expanding it.
