Loan application

New legislation would streamline the EIDL small business loan application process

The EIDL rationalization law is a bipartisan bill introduced in the US Senate to improve the application process for the Economic Disaster Loan (EIDL) as well as to combat fraud in the program. The goal is to simplify the process so that small businesses can get their queries answered quickly and efficiently.

New legislation would streamline the EIDL small business loan application process

The need to introduce such a bill speaks to the level of bureaucracy that exists when small business owners complete their EDIL applications. Sen. Jim Risch (R-Idaho) says small businesses in his state are struggling to get the answers they need on their EIDL applications from the SBA.

Senator Risch goes on to say, “They were forced to submit the same document multiple times, received vague and ambiguous responses from the agency, and in some cases had to deal with fraudsters submitting false claims to them. name.

Adding: “Small businesses deserve a program that actually works the way it should, and the EIDL Streamlining Act will go a long way to fixing the flaws in the EIDL application process and making these disaster loans accessible. to small businesses.”

A slow and unorganized examination process is also partly responsible for the delay in the application process. With these and other issues facing small business applicants, the EIDL Streamlining Act:

  • Impose delays on the EIDL program application process
  • Require the SBA to conduct a comprehensive review of the EIDL application submission process
  • Order the SBA to submit a report to Congress detailing the steps it has taken to correct the way it has handled identity theft cases
  • Require the SBA to report how it recovered the improper payments and how it reconciles previous identity theft allegations with newly filed identity theft allegations

The bipartisan legislation was co-sponsored by Sens. John Kennedy (R-La.), Jim Risch (R-Idaho), Roger Marshall (R-Kan.), John Hickenlooper (D-Colo.) and Catherine Cortez-Masto (D-Nev.)

You can read the full text of the Rationalization of the EIDL law for more details.

Make EIDL more efficient

Small business owners turn to EIDL when they really need help. The recent tornadoes that decimated many small family businesses in Kentucky are a prime example. For businesses like Mayfield Consumer Products, which was completely destroyed, a slow and drawn-out application process can prevent owners from starting the recovery process. And this of course extends to the many employees who worked at the factory.

The EIDL Streamlining Act is a step in the right direction to speed up a process that is currently not as efficient as it could be. According to one of the bill’s co-sponsors, Senator Kennedy, “Louisiana’s small businesses face enough adversity. They don’t need a bureaucracy to make it harder to get clear answers on their EIDL requests or to fight fraud.

When it comes to fraud, the problem is also a big problem. The SBA issued $4.5 billion in unnecessary EIDL loans in 2020. Sole proprietors with absurd claims received millions of dollars claiming they had a million employees. In fact, 15 sole proprietors made such outlandish employee claims in their applications. That’s $4.5 billion that could have gone to deserving small business owners impacted by the pandemic.

Here’s the EIDL Streamlining Act passed without much opposition so small business owners can get the help they need when they need it.

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