WASHINGTON—The Small Business Administration has released an update on the status of its economic injury disaster loan (EIDL) program's reconciliation payments for any loan with an SBA forgiveness payment that was reduced by the amount of an EIDL advance.
The SBA began remitting payments Tuesday and will continue to do so through Feb. 19.
Of note, credit unions and borrowers do not need to submit anything to the SBA to receive the reconciliation payment. The reconciliation payments will be made via automated clearing house (ACH) to the account identified by the paycheck protection program (PPP) lender on record in the SBA’s forgiveness platform, NAFCU noted.
Credit unions are responsible for notifying borrowers of the reconciliation payment and re-amortizing the loan and notifying the borrower of the amount of the next payment due, or whether the loan is repaid in full.
An Additional Note
The SBA also noted that if the reconciliation payment exceeds the remaining balance of the PPP loan – because the borrower made a payment on the loan – then the lender must remit the excess amount, including any accrued interest paid by the borrower, to the borrower.
In addition, the SBA’s latest data on PPP loans reveals that more than 1.2 million program loans – totaling $100.9 billion – from over 5,000 lenders have been approved in 2021 as of Feb. 7. There have been 774 credit union lenders with assets under $10 billion that have made 45,000 program loans – totaling $2.2 billion – since the program reopened this year.