There’s a clear way for Congress to improve the PPP loan program and help America’s small businesses


  • America’s small businesses have been crushed by the coronavirus pandemic, but the PPP loan program has helped soften the blow.
  • Now many small businesses are set to ask for their PPP loans to be forgiven by the federal government, but the current process is expensive and time consuming.
  • The Paycheck Protection Small Business Forgiveness Act would streamline the forgiveness process, helping many small businesses while maintaining important scrutiny over the largest PPP loans.
  • Kevin Cramer is a United States Senator from North Dakota. He is a member of the Senate Budget and Banking committees.
  • This is an opinion column. The thoughts expressed are those of the author.
  • Visit Business Insider’s homepage for more stories.

For months, small businesses across the United States have experienced tremendous anxiety and financial insecurity due to the COVID-19 pandemic. 

Businesses  are unsure of whether they can outlast the economic downturn, partially reopen in compliance with local health safety standards, or even be allowed to reopen at all. Likewise, their employees have to worry about basic questions like whether they will have a job or how to put food on the table and keep a roof over their heads.

This is why the Senate crafted the Paycheck Protection Program (PPP) in March. This wildly popular program delivered over $500 billion to struggling businesses who used it to save jobs and keep themselves afloat. We also provided a path for the loans to be forgiven if they were used properly.

While PPP was a great success, it now gives small businesses and lenders a new source of anxiety. According to a report by AQN Strategies, the current procedures to receive loan forgiveness could cost small businesses $2,000 and lenders $500 for PPP loans of less than $150,000. 

Congress can and should play its part in alleviating their concerns and allow them to focus on restarting the American economy.

Making it easier for small businesses to get PPP loans forgiven

To address the uncertainty around PPP loan forgiveness, my colleagues and I introduced bipartisan legislation which would remove the stress placed on both borrowers and lenders. The bill named The Paycheck Protection Small Business Forgiveness Act, would streamline the forgiveness process for small businesses and reduce unnecessary bureaucracy while protecting taxpayers.

The Act offers forgiveness for PPP loans of $150,000 or less if the borrower submits a simple, legally-binding, one-page attestation form to the lender.

There are approximately 4.2 million PPP loans of $150,000 or less, accounting for 85%of all PPP approved loans. However, these loans only cover 26%of the PPP funds spent. In my state of North Dakota, which had the highest participation rate per capita, the average size of the state’s 19,724 PPP loans was $91,000.

Streamlining the forgiveness process for these small businesses eases their anxiety and allows the federal government to focus its oversight responsibilities. Without a simplified forgiveness process, agencies in the executive branch will have to greatly expand their workforce to review the millions of forms they will receive. Our bill allows federal agencies to focus oversight efforts on the larger PPP loans which account for 74% percent of the PPP funds spent.

Our legislation also eliminates the high cost of bureaucratic compliance, saving small businesses $8.4 billion and lenders nearly $2 billion.

We should not be asking our borrowers and lenders to unnecessarily spend precious resources on complying with federal programs designed to help them weather this economic downturn.

Our legislation also ensures the PPP lender will not be held liable if a borrower’s form contains falsehoods. The one-page attestation ensures that while compliance burdens will be eased, borrowers will still be held accountable should they misuse federal funds or commit fraud. The audit process remains intact and borrowers will be held accountable if their attestation is proven false.

A bipartisan push

This is a commonsense next step in combating the economic downturn caused by COVID-19, and support for this bipartisan legislation grows every day. 

After I introduced it with Sens.Bob Menendez (D-NJ), Thom Tillis (R-NC), and Kyrsten Sinema (D-AZ), over 140 business organizations offered their support, as well as the Bankers Association from every state. Treasury Secretary Steven Mnuchin endorsed the concept of the bill at a House hearing earlier this month.

We now have 25 senators on the bill, and we expect more to come.

At a time when every cent matters, we have the opportunity to sidestep costly bureaucracy which is only going to reach the same foregone conclusion that these loans should be forgiven.

The Paycheck Protection Small Business Forgiveness Act would give small businesses peace of mind by eliminating unnecessary bureaucratic requirements and simplifying the process for forgiving smaller loans. I urge my colleagues to support it and leadership to include it in the Phase Four relief package.

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