SBA Posts Lender Agreement Amid Flawed Launch

Apr 03, 2020

Rebeca Romero RaineyDear Community Banker:

We know today's flawed launch of the Small Business Administration's Paycheck Protection Program has been filled with high tensions and desperate attempts by community bankers to meet the needs of their small-business customers.

Community bankers have always been there to meet their customers’ needs, and to be faced with a situation like they experienced today—in which they were unable to access the SBA programs promised to America’s small businesses due to failed technology links and portals—has been beyond stressful and disappointing for community bankers.

At the time of this release, the new portal is still not up and running and there is no ETA as to when that will occur. In addition, those banks with access to the E-Tran have expressed significant challenges with user access and latency in application processing. At the same time, media reports continue to indicate successful launches through the country by community banks, few of which we have been able to confirm.

Throughout the day today we have been in constant communication with Treasury and SBA to follow through on their promise to deliver much-needed funding to the thousands of small businesses that serve as the economic engines to our nation.

Community banks make 60 percent of all small-business loans, but they have been excluded from the process, and even implicated in numerous media stories as being unable to deliver, which could not be further from the truth. Rest assured, if community banks had been given the tools to deliver, they would have delivered.

We are continuing to work through this process and have been informed that the following developments are in the works to help community banks access this program.

The SBA has posted its Lender Agreement, an application for non-SBA-certified lenders to apply to enter the PPP system, input borrower applications, and register for SBA loan guarantees. The SBA encourages lenders who need assistance accessing the agency's E-Tran system to call its Lender Customer Service Line at 833-572-0502.

The latest updates follow the release last night of an interim final rule on the program. That rule increased the PPP interest rate to 1 percent from 0.5 percent and provided additional clarity on lender due diligence responsibilities, though access has remained extremely limited or altogether closed off for community banks across the nation.

With Treasury and SBA continuing to point lenders and borrowers to their PPP webpages, ICBA and state community banking associations have clearly and repeatedly expressed community bank concerns about the program's terms and lack of guidance.

Throughout this difficult rollout, please know that ICBA understands the gravity of this situation and is pulling out all stops to rectify this debacle. We remain committed to our mission and dedicated to preserving the stellar reputation of community banks throughout this great nation.

We will continue to keep you informed of the latest developments as soon as they are available. Thank you again for all that you are doing—and trying to do—on behalf of your communities at this challenging time.