The Small Business Administration’s computers crashed for multiple hours on Monday, halting the ability of bank lenders to process loans for businesses hurt by the coronavirus.
The SBA loan application processing system, known as “E-Tran,” was having significant issues before it even went down.
“A couple hours ago, it had completely stopped. No loans were getting through,” said Paul Merski, executive vice president at the Independent Community Bankers of America. “Thousands of community bankers processing these loans came to standstill a few hours ago.”
He said, “Loans were only going through in a trickle, very slowly.” Banks putting through thousands of small-business loans for approval are getting only a handful back, he said.
In a letter sent to lenders, the SBA said, “We are having telecommunication issues. This has seriously degraded the system response time. We have a team of engineers working on it.”
The loans are meant to be the centerpiece of Washington’s plan for keeping small businesses afloat through the pandemic. Congress passed legislation last month authorizing $349 billion in the loans. The loans are forgivable if they are used to maintain payroll or to pay for certain forms of overhead.
Trump said during the coronavirus briefing on Monday that the SBA loan program had gotten off to a “tremendous start, but there are some small glitches.” He also said the process for loan application approval is “very fast,” but that banks “were swamped.”
Amazon Web Services, the biggest cloud computer services provider was hired last week as a subcontractor to help stabilize the SBA loan program with a new software tool for bank lenders in the program, Nick Simpson from the Consumer Bankers Association said.
Republican Senator Marco Rubio, chairman of the Senate Committee on Small Business and Entrepreneurship, tweeted on Monday that SBA is “working with Amazon Web Services & a systems integrator to develop a portal. Again, time is of the essence for this as well.”
