Fraud Checks and Errors Slow Small-Business Relief Loans
The renewed Paycheck Protection Program has disbursed $140 billion this year, but many applicants have had to wait weeks for lenders to resolve problems.
Shelly Ross found herself in a bureaucratic nightmare after requesting a second loan via PayPal for Tales of the Kitty, her San Francisco cat-sitting business.Credit.Anastasiia Sapon for The New York Times
Feb. 22, 2021
The problems plaguing those seeking loans from the government’s revived small-business relief program have ranged from simple to shocking.
Some applications were stalled for weeks by typos. Overzealous fraud filters trapped others. A change of taxpayer identification rules snarled many freelancers and sole proprietors. And then there were the thousands of people turned down because they erroneously registered as having a recent criminal conviction.
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The problems plaguing those seeking loans from the government’s revived small-business relief program have ranged from simple to shocking.
Some applications were stalled for weeks by typos. Overzealous fraud filters trapped others. A change of taxpayer identification rules snarled many freelancers and sole proprietors. And then there were the thousands of people turned down because they erroneously registered as having a recent criminal conviction.
“It’s been a nightmare,” said Martha Theirl, who spent hours battling three levels of customer service support at her bank in her attempt to get a loan for her physical therapy business.
Six weeks into the second run of the Paycheck Protection Program, $134 billion in emergency aid has been distributed by banks, which make the government-backed loans, to 1.8 million small businesses. But a thicket of errors and technology glitches has slowed the relief effort and vexed borrowers and lenders alike.