It didn’t take long for the Small Business Administration (SBA) to become overwhelmed by a deluge of applicants for the latest round of Paycheck Protection Program (PPP) money. Less than five minutes after the much-hyped launch of PPP II scheduled for 10:30 a.m. on Monday (April 27), the SBA site was inaccessible, a source told Bloomberg News.
Paul Merski, executive vice president of the Independent Community Bankers of America (ICBA), told the news service that lenders nationwide couldn’t access the site in the morning.
Spokespersons for the SBA and the Treasury did not respond to a request for comment from PYMNTS.
The site was working at 2:30 p.m. on Monday when PYMNTS checked.
More than 5,000 lenders have been approved to participate in the program. Over the weekend, the SBA said that while banks could submit applications in bulk, they have limited the total amount in PPP loans issued by one bank to 10 percent of the program’s overall funding.
On Friday (April 24), President Donald Trump signed the $484 billion COVID-19 rescue bill with more money for the small business loan program, hospitals and testing. The measure includes more than $320 billion for the PPP, created by the CARES Act, which provides forgivable loans to small businesses to help keep their employees on the payroll.
The new money came as Johns Hopkins University reported that more than three million people have tested positive for the coronavirus worldwide, while 208,000 have died.
An SBA spokesman told Bloomberg that the agency notified lenders on Sunday (April 26) that it would pace the rate of applications to prevent any single lender from submitting thousands of loans into the system at once.
Nearly two weeks ago, the SBA reported that the initial $349 billion fund intended to keep small businesses afloat amid COVID-19 was out of money. Its website noted they were “unable to accept new applications for the Paycheck Protection Program based on available appropriations funding. Similarly, we are unable to enroll new PPP lenders at this time.”
Giant companies including Shake Shack Inc. and the operator of Ruth’s Chris Steak House returned their loans after an outcry from small businesses who said they were shut out of the loan program while major companies benefited.