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Financial Services Law Insights and Observations

SBA updates PPP processing fee guidance

Federal Issues Covid-19 SBA EIDL

Federal Issues

On February 8, the Small Business Administration (SBA) issued an updated procedural notice addressing changes to the Paycheck Protection Program (PPP) processing fees and reporting process. The notice covers the breakdown of fees for first-draw PPP loans made after December 27, 2020 and for second-draw PPP loans. The notice notes that “all processing fees are based on the balance of the PPP loan outstanding at the time of full disbursement of the loan.” The SBA states that lenders may request payment of processing fees after the lender successfully reports that the loan has been fully disbursed by using Form 1502. Moreover, the SBA states that it will remit Economic Injury Disaster Loan (EIDL) reconciliation payments from February 9 through February 19. As previously covered by InfoBytes, SBA is no longer deducting EIDL advances from PPP forgiveness payments, and for any forgiveness payments that were already reduced by an EIDL advance, the SBA will automatically remit a reconciliation payment to the PPP lender that will include the advance amount plus interest through the remittance date. 

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