SBA

In round two of the Paycheck Protection Program, the bank has sent some 256,000 loan applications to the Small Business Administration for processing.

The Small Business Administration's systems froze up shortly after the latest Paycheck Protection Program was launched Monday morning.

The policy move will allow small institutions participating in the Paycheck Protection Program to pledge business loans as collateral to obtain advances.

The program, created in response to the 2008 financial crisis, generated $19 billion in small-business loans. It could be used as a viable path out of the coronavirus pandemic.

The Small Business Administration stopped approving loans when the Paycheck Protection Program hit its cap.

The Fed's actions are designed to ensure the flow of credit to midsize businesses and state and local governments hit hard by the economic impact of the coronavirus pandemic.

The Small Business Administration said lenders approved $71 billion in loans from the Paycheck Protection Program in less than five days.

The Small Business Administration’s loan processing platform went down Monday for as long as four hours, temporarily halting the ability of lenders to process loans for small business owners seeking relief from the impact of the coronavirus.

Lenders must balance the financial risk of extending credit without explicit backing from the Small Business Administration against the reputational risk of delaying aid for needy borrowers.

The central bank is creating a facility to provide financing to banks participating in the Small Business Administration’s Paycheck Protection Program.