Loans

Small Business Rescue Program Encounters Technical Challenges

Small Business Rescue Program Faces Challenges

Amid processing and technology challenges that are holding back payments, the U.S. government’s $350 billion small business rescue program began its fourth day on Monday (April 6). Lenders faced loan requests in the thousands, as they encountered difficulties with tech access and changing paperwork, Reuters reported.

The Independent Community Bankers of America (ICBA) told the Small Business Administration (SBA) and the Treasury about the “massive delays” and “failed technology” that members were facing. In addition, community bankers shared their frustrations on social media about not being able to get into the system and modifications to the form.

The SBA’s regional offices said to bankers over the weekend, per the report, “We know that your efforts have been frustrated with system issues, policy questions and slower than usual responses.”

A number of lenders had difficulties getting new user accounts via the SBA’s platform. Bankers who had accounts, however, also encountered difficulty getting into them or making new passwords.

Financial institutions (FIs) began to accept Paycheck Protection Program (PPP) applications on Friday (April 3). Among the larger lenders in the country, however, only JPMorgan Chase and Bank of America (BoA) had the ability to roll out the program, and they faced a deluge of applicants.

More than 85,000 people asked for $22.2 billion in loans at BoA, which reportedly caused the lender to restrict applicants to current clients. People took to social media to complain about how they were sent away by BoA, and how other FIs weren’t yet taking applications.

A BoA manager told staff in an email on Friday, per the report, “That is an astounding number of applications to take in such a short period of time, considering we just launched the site this morning at 8:45 a.m.”

——————————

LIVE PYMNTS ROUNDTABLE: MODERNIZING & SCALING FOR THE NEW NORMAL

The pressure on banks to modernize their payments capabilities to support initiatives such as ISO 20022 and instant/real time payments has been exacerbated by the emergence of COVID-19 and the compelling need to quickly scale operations due to the rapid growth of contactless payments, and subsequent increase in digitization. Given this new normal, the need for agility and optimization across the payments processing value chain is imperative.

TRENDING RIGHT NOW