Bill will help improve SBA communication throughout the EIDL application process and address fraud
Washington, D.C. – Today, U.S. Senators John Hickenlooper and Jim Risch introduced the bipartisan Streamlining EIDL Act to improve the Economic Injury Disaster Loans (EIDL) application process for small businesses and combat fraud. The legislation will require the Small Business Administration (SBA) to provide timely responses to small business applicants and submit a report to Congress on how it is addressing fraud within the program.
The EIDL program provides working capital to small businesses to help overcome the effects of the pandemic or other disasters. In a July report, the Government Accountability Office found that unclear and sporadic communication from the SBA has been a major issue for many EIDL applicants – at the height of the pandemic, the SBA’s customer service line experienced call surges that resulted in wait times up to 4 hours. Another report found that there were over 20,000 suspicious activity reports related to the EIDL program between May and October 2020.
“Economic Injury Disaster Loans have been a lifeline for small businesses throughout the pandemic,” said Hickenlooper. “This bill will help businesses stay open and prevent fraud, a win-win.”
“Small businesses in Idaho have struggled to get meaningful answers on their EIDL applications from the SBA,” said Risch. “They’ve been forced to submit the same document multiple times, received vague and ambiguous responses from the agency, and in some cases, had to contend with fraudsters submitting false applications on their behalf. The Streamlining EIDL Act will go a long way to fix the flaws in the EIDL application process and make these disaster loans accessible to small businesses.”
The Streamlining EIDL Act sets commonsense timelines for SBA communication to loan applicants throughout the application process. The bill also requires the SBA to conduct a comprehensive review of the process for submitting an EIDL application.
Specifically, the timelines are:
- 7 days to acknowledge receipt of the application and provide contact info in the event the applicant has questions
- 21 days to provide a written report of the status of the application and an explanation regarding the appeals process
- 45 days to approve or deny the application
- 90 days to conduct a comprehensive review of the process for submitting an application
In addition to improving communication, the legislation directs the SBA to submit a report to Congress detailing steps it has taken to rectify its handling of identity theft cases, require the SBA to report how it has recovered improper payments, and require the SBA to report on how it is reconciling previous identity theft allegations with newly filed identity theft allegations.
Additional sponsors of this bill include U.S. Senators Roger Marshall, Catherine Cortez-Masto, and John Kennedy.