The Trump administration downplayed complaints about delays and errors in accessing a small-business emergency lending program reopened Monday.
“I know that there are some sad stories about people getting stuck at the website and so on, but there’s plenty of time for all that stuff to be worked out,” said Kevin Hassett, a senior economic adviser to President Trump.
The Small Business Administration’s small-business relief program, called the Paycheck Protection Program, provides forgivable loans to small businesses hurt by the pandemic that maintain payrolls. The program was initially funded with $350 billion as part of the massive $2.3 trillion CARES Act relief package. The program was given an additional $321 billion last week after the initial $350 billion ran out within just two weeks and reopened Monday.
The program’s website for loan applications has been slow to accept applications and has even crashed at times, halting the ability of bank lenders to process loans for businesses hurt by the coronavirus.
However, Hassett’s main message Monday regarding the program was that it had been effective at helping small businesses during the coronavirus ecomomic shutdown.
“The bill is incredibly successful at getting a massive money amount of money out to small businesses that needed it, with more than a million loans going to businesses with 10 or fewer employees,” Hassett said regarding the SBA’s relief program.
Lenders and banks who are disbursing the SBA relief funds to small businesses, though, have a different perspective on the program’s frustrations over the past few weeks and said that the problems were repeating after the program reopened.
Multiple bank lenders said Monday that the SBA relief program’s website was extremely slow and unreliable, with the website crashing multiple times and causing banks to be kicked out of the system due to unknown errors.
“The SBA’s systems were not designed to and are not capable of handling the volume of loans banks processed over the last several weeks for small businesses,” Consumer Bankers Association Chief Executive Officer Richard Hunt said Monday. The association represents many banks disbursing the relief funds. “It is critically important for the SBA to be transparent and forthright about these limitations with the millions of men and women waiting for assistance,” said Hunt.
Nearly 80% of small-business owners surveyed on April 17 who applied for the federal loan program that helps cover payroll did not know where they were in the application process, forcing some of them to furlough workers.
“It’s like SBA hired Captain Renault to run the IT department and they are ‘shocked’ their systems are having any problems,” a banking industry executive said Monday, referring to the film Casablanca, in which Renault is a trickster, playing all sides to his own advantage. “Banks are working to deliver assistance, and SBA is passing the blame.”
