PPP news: Beginning Wednesday morning and ending March 9, the SBA will only accept PPP applications from businesses with fewer than 20 employees. It’s part of a plan Biden will announce today focused on delivering aid to underserved small businesses
The SBA also plans to:
— Change PPP eligibility rules so sole proprietors, independent contractors and self-employed individuals receive more funds
— Eliminate restrictions on business owners with non-fraud felony convictions and those delinquent on their federal student loans
Biden administration officials say that PPP applications submitted by larger businesses before Wednesday will continue to be processed and will not face a delay
The SBA plans to give the smallest businesses exclusive access to PPP even though less than half of available funds have been used and aren’t expected to run out. The Biden admin says it wants to use the two-week window to have lenders focus on those employers. PPP ends March 31
The Biden administration has not yet briefed PPP lenders on its plans for revamping the program. Administration officials plan to talk to banks later today. Banks are responsible for submitting PPP applications to SBA
Here is the White House fact sheet on the PPP changes the Biden administration announced whitehouse.gov/briefing-room/…
Even with significant PPP funds remaining and Congress set to approve another $7bn, the White House isn’t taking a position on whether the PPP should be extended beyond March 31. An administration official says if Congress wanted to pursue an extension, "we'll consider it then."
The PPP change that will allow sole proprietors to obtain larger loans will only be available to new applicants and won't be retroactive if you've already been approved. The revision will allow sole props to use gross income numbers rather than net profit when applying
SBA on the sole proprietor changes only being available to new applicants: "We are not able to retroactively change the loan amount on any PPP loan that has already been approved by a lender and received the federal guarantee."
My story on Biden's revamp of the PPP politico.com/news/2021/02/2…
PPP lenders will be key to executing Biden's PPP changes. They're skeptical. @cajunbanker says the two-week window "will not fundamentally alter the roadblocks businesses are facing" until SBA streamlines bookkeeping requirements and resolves internal processing issues
UPDATE: Concerns are beginning to emerge about Biden's PPP revamp.
-- Sole props will be eligible for larger loans but won't get that benefit if they've already received funds
-- Banks doubt Biden's two-week window for tiny businesses will have an impact politico.com/news/2021/02/2…
To what extent will businesses with fewer than 20 employees benefit from two weeks of exclusive access to PPP? Bank of America, one of the top PPP lenders, says that 93 percent of the 87,000 PPP loan applications it has processed this year have been for firms in that category

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More from @Zachary

20 Jan
The Biden Treasury just announced its first hires. They include:

• Didem Nisanci, chief of staff, formerly of Bloomberg LP
• Julie Brinn Siegel, deputy chief of staff, former Warren aide
• Alfred Johnson, deputy chief of staff, former Obama admin official and BlackRock VP
More Biden Treasury hires:
• Calvin Mitchell, assistant secretary for public affairs
• Marti Adams, executive secretary
• Jacob Leibenluft, counselor to the secretary
• Ryan Jacobs, chief speechwriter and senior advisor
Nisanci, Treasury chief of staff, was previously CoS at the SEC during the Obama administration. She also led the secretariat of the international Task Force on Climate-related Financial Disclosures, another indication that climate policy will be a key focus of Treasury
Read 4 tweets
8 Jan
🚨The SBA will restart PPP on Monday. Lenders targeting underserved communities will have exclusive access to offer loans to new borrowers Monday and Tuesday. They will then be able to offer second loans to existing borrowers Wednesday. PPP will open widely a few days later
The lenders that will have exclusive access to offer PPP loans next week include community development financial institutions and minority depository institutions. The pool of banks make up about 10 percent of the lenders participating in the program
Trump administration officials want to get the word out that there will be enough funding to meet demand for the first and second PPP loans and that money will not run out like last time
Read 11 tweets
7 Oct 20
Treasury Deputy Secretary Muzinich says the administration is studying the possibility of a government-sponsored digital currency, as is the Fed. He says there are efficiency and cost benefits to using a distributed ledger and that it's important for govt to embrace innovation
"There is a lot of work going on behind the scenes," Treasury's Muzinich says, but no decision yet on whether to move forward with a government-sponsored digital currency.
Muzinich says concerns that officials are studying as Treasury and the Fed weigh a govt-backed digital currency include the potential for illicit financial activity, risks to financial stability, implications for the banking system, privacy
Read 4 tweets
8 May 20
New IG report says SBA's rules for PPP loan forgiveness could result in an "unintended burden." Cites concerns about requirement that 75pc of funds go to payroll. Says tens of thousands of borrowers from PPP Round 1 would not meet the threshold
The SBA IG report is here sba.gov/sites/default/…
SBA IG on PPP: "Our review of data from round one found that tens of thousands of borrowers would not meet the 75-percent payroll cost threshold and would therefore have to repay the amount of nonpayroll costs in excess of 25 percent in less than 2 years."
Read 9 tweets
28 Apr 20
Large banks say they submitted hundreds of thousands of PPP applications but they’re in the dark about how the SBA is handling the loans politico.com/news/2020/04/2…
Bank of America from Sunday through early Monday sent 184,000 PPP applications to the SBA. As of yesterday afternoon, it was waiting for the agency to process the loans. The bank believed it had just 1,000 loans approved so far.
JPMorgan Chase submitted a similar number of applications as Bank of America. Wells Fargo said it submitted more than 100,000 applications on Monday.
Read 5 tweets
17 Apr 20
Some banks are continuing to take Paycheck Protection Program applications while funding is lapsed. Others are not. Here's a thread on where things stand at various lenders.
Bank of America: "We’re continuing to accept and process applications in the expectation that there will be additional funding available, given comments by the President and Congressional leaders." about.bankofamerica.com/promo/assistan…
Wells Fargo: "We will continue to prepare applications in our existing pipeline from small and mid-size businesses and will submit them to the SBA when funds become available." update.wf.com/coronavirus/pa…
Read 7 tweets

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