Paycheck Protection Program overview
The Paycheck Protection Program (PPP) delivers relief to small businesses and their employees who have been impacted by the COVID-19 pandemic. Administered by the SBA under the CARES Act, this program provides funds to small businesses, independent contractors and self-employed individuals. The loan funds help businesses to cover expenses such as:
To date, Synovus has assisted in closing approximately 19,000 loans totaling 2.9 billion dollars since the program’s introduction in early April.
Here's what we know
On Friday, May 15, the SBA and U.S. Treasury released the first iteration of the PPP Loan Forgiveness Application, which detailed instructions on borrowers’ responsibilities under the program. On Friday, June 5, President Trump signed the Paycheck Protection Program Flexibility Act. The PPP Flexibility Act amends the CARES Act to modify certain provisions related to the forgiveness of loans under the Paycheck Protection Program.
Since then, the SBA has continued to release additional guidance to include more flexibility for borrowers, as well as more clarity around the loan forgiveness application process. Some highlights include:
- Providing an option for most borrowers to extend their covered period for loan forgiveness
- Introducing a new “EZ” application form for borrowers who meet certain criteria
- Allowing businesses more time to spend funds and to use a larger share of the loan forgiveness amount on non-payroll costs
- Reducing the percentage of the loan forgiveness amount that must be attributable to payroll as opposed to non-payroll costs from 75% to 60%
- Providing the option for borrowers to extend loan maturity to 5 years, if approved by the originating bank, and the potential for a longer payment deferment period
- Extending the safe harbor period by which you can offer to rehire workers without reducing your forgiveness amount until December 31, 2020
Over the next few weeks we expect the SBA will continue to provide further guidance and instructions regarding procedures we must follow to complete the forgiveness process. So, as we work on your request once our digital platform opens, please keep in mind any new guidance released by the SBA may require that we reach out to you regarding updates to your application. This may also impact the timeframe required to complete the process.
Here’s what to expect
We expect to launch our digital loan forgiveness application process for uploading documentation, providing required certifications, and signing your application, later in July.
The Synovus forgiveness process will be completely online. It's important to educate yourself on the forgiveness requirements by reviewing the newest forms and instructions, the most current interim final rule, and any prior interim final rules (available on SBA website under "Lender Forms and Guidance"). As part of our online forgiveness process, we'll also ask you questions related to payroll calculations you'll make using the "Schedule A Worksheet," which can be found in the loan forgiveness application on SBA's website. You won't need to provide this document through our digital portal but be sure to maintain a copy for your records in the event it is needed for review by Synovus or the SBA.
We're looking forward to opening up our digital forgiveness process as soon as possible. In the meantime, we’d like to hear from you about your forgiveness plans. If you haven’t responded already, we’d appreciate your response to three simple questions regarding when you expect to begin the forgiveness process.
Thank you for your patience as we continue to receive and share updates from the SBA as we prepare to launch our digital platform. We appreciate the opportunity to serve you.