Second Updated Paycheck Protection Program Lender Processing Fee Payment and 1502 Reporting Process
Summary
This SBA Procedural Notice, Control No. 5000-20091, effective February 8, 2021, updates Procedural Notice 5000-20036 on how PPP lenders report loans and collect processing fees, to reflect the Economic Aid Act. For First Draw loans made before December 27, 2020, fees are 5 percent for loans of not more than $350,000, 3 percent above $350,000 and under $2,000,000, and 1 percent for $2,000,000 or more. For First Draw loans made on or after that date, loans of not more than $50,000 earn 50 percent or $2,500, whichever is less, with the other tiers unchanged. Second Draw loans earn 50 percent or $2,500, 5 percent, and 3 percent for loans above $350,000.
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Full text
SBA Procedural Notice
TO: All SBA Employees and Paycheck Protection CONTROL NO.: 5000-20091
Program Lenders
EFFECTIVE: February 8, 2021
SUBJECT: Second Updated Paycheck Protection
Program Lender Processing Fee Payment and 1502
Reporting Process
The purpose of this Notice is to update SBA Procedural Notice 5000-20036, effective July 13,
2020, which informs Paycheck Protection Program (PPP) Lenders of the reporting process
through which PPP Lenders will report on PPP loans and collect the processing fee on fully
disbursed loans that they are eligible to receive. This update addresses changes made by the
Economic Aid to Hard-Hit Small Businesses, Nonprofits, and Venues Act (P.L. 116-260),
including new First Draw PPP Loans and Second Draw PPP Loans.
What is the PPP processing fee that SBA will pay to Lenders?
For First Draw PPP Loans made before December 27, 2020, including authorized increases on
those First Draw PPP Loans,1 SBA will pay Lenders fees for processing the loans in the
following amounts:
• Five (5) percent for loans of not more than $350,000;
• Three (3) percent for loans of more than $350,000 and less than $2,000,000; and
• One (1) percent for loans of at least $2,000,000.
For First Draw PPP Loans made on or after December 27, 2020, SBA will pay Lenders fees for
processing those loans in the loans in the following amounts:
● Fifty (50) percent or $2,500, whichever is less, for loans of not more than $50,000;
• Five (5) percent for loans of more than $50,000 and not more than $350,000;
• Three (3) percent for loans of more than $350,000 and less than $2,000,000; and
• One (1) percent for loans of at least $2,000,000.
1
See, SBA Procedural Notice 5000-20076, First Draw Paycheck Protection Program Loan
Increases After Enactment of the Economic Aid Act, issued on January 13, 2021, for specific
information regarding payment of processing fees on authorized loan increases.
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For Second Draw PPP Loans, SBA will pay Lenders fees for processing those loans in the
following amounts:
• Fifty (50) percent or $2,500, whichever is less, for loans of not more than $50,000;
• Five (5) percent for loans of more than $50,000 and not more than $350,000; and
• Three (3) percent for loans above $350,000.
Under 15 U.S.C. § 636(a)(36)(P) and 15 U.S.C. § 636(a)(37)(L), all processing fees are based on
the balance of the PPP loan outstanding at the time of full disbursement of the loan.
How can Lenders request payment of PPP processing fees?
When a PPP Lender successfully reports to SBA that a First Draw PPP Loan or Second Draw
PPP Loan has been fully disbursed, SBA will initiate the process of paying the PPP processing
fee that the PPP Lender is eligible to receive. Lenders will use an SBA Form 1502 (1502 report)
to report fully disbursed loans to SBA (the process of which is outlined in this Notice below).
Additionally, in the Lender’s Fiscal Transfer Agent (FTA) Lender portal, the Lender must have
provided ACH credit information for an account owned by the Lender and must make a one-time
confirmation2 that all PPP loans for which the Lender will be requesting a processing fee have
been fully disbursed on the disbursement dates and in the loan amounts reported.
Upon receipt of a complete set of SBA Form 1502 data, SBA will:
• Except for authorized increases on First Draw PPP Loans, confirm that no previous
request has been made for a processing fee on the loan, and no processing fee payment
has been made previously by SBA on the loan.
• Confirm that the disbursed amount reported on the 1502 report matches the approval
amount in E-Tran.
• Calculate the processing fee owed based on the final fully disbursed amount entered by
the Lender.
• Submit the fee calculated by SBA to the Lender using the ACH credit information
provided by the Lender.
How do Lenders create an account (i.e., enroll) in the FTA’s Lender Portal?
Before Lenders can receive a PPP processing fee or begin monthly loan reporting, they must
establish a Lender portal account with the FTA to access the 1502 Dashboard.
Existing SBA Lenders with SBA Form 750 agreements will access the 1502 Dashboard with
their current FTA Lender portal account. Lenders must use separate 1502 reports for PPP
2
Pursuant to SBA Procedural Notice 5000-20076, by submitting a 1502 report on a First Draw
PPP Loan or a Second Draw PPP Loan on or after January 13, 2021, any Lender that submitted a
1502 report for a PPP loan before January 13, 2021 agrees to a revision to the one-time
confirmation previously made by the Lender.
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loans (including both First Draw PPP Loans and Second Draw PPP Loans) and regular
7(a) loans.
PPP Lenders who do not already have an account with the FTA can enroll by sending an email to
Enrollment@colsonservices.com that contains the following:
• Name of Institution;
• At least two of the following:
o E-Tran Main Location ID (CAFS Location ID under which loans were
originated);
o One of SBA’s PPP GP loan numbers; and
o Colson Lender ID (if known);
• Individual user contact information:
o Name;
o Email address; and
o Phone number.
Lender Service Providers: Lender Service Providers (LSPs) providing services for PPP
Lenders under a reviewed LSP agreement who do not already have an account with the FTA can
enroll by sending an email to Enrollment@colsonservices.com that contains the following:
• Name of LSP;
• LSP CAFS Partner ID;
• Individual user contact information:
o Name;
o Email address; and
o Phone number;
For each bank partner, provide the information below:
• Bank partner’s information:
o Bank name;
o E-Tran Main Location ID
• One of SBA’s PPP GP loan numbers;
• Colson Lender ID (if known);
• Bank Authorizing Official
o Name;
o Email address; and
o Phone number.
Upon receipt of a complete enrollment email, the FTA will send login credentials consisting of a
1502 Dashboard User ID and Access Code. The User ID and Access Code will be sent in
separate e-mails.
Once the Lender has successfully logged into its Lender portal account, the Lender must provide
the ACH credit information for the account where the Lender wishes to receive PPP processing
fees. The ACH credit information must be for an account owned by the Lender. SBA will not
make any payments to LSPs.
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A Lender portal user guide is available at https://colsonservices.bnymellon.com/_locale-
assets/pdf/1502-dashboard-user-guide.pdf. Questions on the enrollment process may be directed
to Colson Customer Service at 877-245-6159.
May Lenders or LSPs share login credentials for the FTA Lender Portal?
No. Login credentials for the 1502 Dashboard are issued at the individual user level and may not
be shared among users.
How do Lenders report to SBA on loans that are fully disbursed?
Lenders must report First Draw PPP Loans and Second Draw PPP Loans that have been fully
disbursed to SBA via SBA Form 1502 (1502 report). Lenders must electronically submit SBA
Form 1502 reporting information to the SBA within 10 calendar days after disbursement of a
PPP loan.3 Thereafter, Lenders must submit PPP loan information to SBA on a monthly basis.
SBA Form 1502 is a spreadsheet containing identifying information for each PPP loan. An SBA
Form 1502 spreadsheet is available at https://colsonservices.bnymellon.com/_locale-
assets/xls/sba-form-1502-blank-template.xlsx.
Lenders may submit the 1502 report to SBA using any of the following methods:
• Email the 1502 spreadsheet to 1502@colsonservices.com;
• Upload the 1502 spreadsheet (“e-File”) in 1502 Dashboard; or
• Deliver the 1502 spreadsheet via Secure File Transfer Protocol (SFTP) – Requires
additional enrollment. Lenders should email SFTPaccess@colsonservices.com for
additional instructions.
Lenders may batch multiple PPP loans in a single 1502 report, or Lenders may complete a 1502
report on an individual PPP loan basis. There is no limit on how frequently Lenders can submit
1502 reports.
Important: Lenders must use separate 1502 reports for PPP loans (including both First
Draw PPP Loans and Second Draw PPP Loans) and regular 7(a) loans.
After receiving the 1502 report, the FTA will notify the Lender of any errors through
1502 Dashboard exception reporting. Lenders should monitor the 1502 Dashboard daily. The
Lender will have until 5:00 p.m. Eastern on the second business day after submitting the 1502
report to correct any errors within the 1502 Dashboard. On the third business day after receiving
the 1502 report, and provided that the ACH information and one-time lender confirmation have
been entered, SBA will initiate the process for payment of the processing fee to the Lender.
How do Lenders report a PPP loan as fully disbursed on the 1502 report?
Lenders must submit a complete and accurate 1502 report. Each of the fields on the 1502 report
is described below:
3
If the tenth calendar day is a Saturday, Sunday, or legal holiday, the period continues to run
until the end of the next business day.
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• SBA GP Number: The 10 digit numerical SBA assigned loan identification number. The
GP number is the key to identifying Paycheck Protection Program (PPP) loans on the
SBA’s and the FTA’s databases. If less than 10 digits are reported, the disbursement
information cannot be processed.
• Lender Loan Number: The Lender's loan identification number; that is, the number the
Lender has assigned to the loan. This field is optional.
• Next Installment Due Date: The date the borrower is scheduled to make its first
payment following the Program’s automatic deferment period. As a placeholder, this date
should be listed as sixteen months from the date of loan disbursement. After SBA
remittance of any partial forgiveness payment or SBA notice that no forgiveness is
allowed, the deferment period ends and the Lender must update this date to correspond to
the first payment due date the Lender provides to the borrower.
• Status: Leave blank
• Amount Disbursed this Period on Total Loan: The total amount disbursed on the loan.
PPP loans must be fully disbursed, and the amount reported in this field must match the
loan approval amount in SBA’s electronic system.
• Amount Undisbursed on Total Loan: PPP loans must be fully disbursed. Enter $0.00.
• Interest Rate: All PPP loans have an interest rate of 1 percent. Enter 1% or leave blank.
• Guar. Portion Interest: Enter $0.00.
• Guar. Portion Principal: Enter $0.00.
• Total to FTA: Enter $0.00. There are no Guar. Portion Payments or SBA ongoing
servicing fees on PPP loans.
• Interest Period From: Leave Blank.
• Interest Period To: Report the date interest accrues from (e.g., one-time, full
disbursement date or first disbursement date, if applicable) in this column.
• # of Days: Leave Blank.
• Calendar Basis: Leave Blank.
• Guar. Portion Closing Balance: The balance outstanding after the full disbursement.
This amount should be equal to the Amt Disbursed this Period on Total Loan. PPP loans
are 100% guaranteed by SBA and must be fully disbursed.
• Remittance Penalty: Enter $0.00. There are no SBA Subsidy Recoupment Fees or Late
Penalties for PPP loans.
How do Lenders report authorized loan increases on First Draw PPP Loans on the 1502
report?
Lenders that make authorized increases on First Draw PPP Loans should report those increases
on the 1502 report by following the instructions in SBA Procedural Notice 5000-20076, First
Draw Paycheck Protection Program Loan Increases After Enactment of the Economic Aid Act,
issued on January 13, 2021.
How do Lenders report a PPP loan as cancelled in E-Tran Servicing?
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Lenders must request access to E-Tran Servicing in their https://caweb.sba.gov account (which is
different than the FTA Lender portal account) through the Lender’s authorizing official.
From E-Tran Servicing, search for the SBA loan number.
Once the loan number comes up, click on the cancel button at the top of the page. This will
cancel the loan and the loan guaranty. Questions on cancellations can be emailed to
7aQuestions@sba.gov.
How do Lenders report a PPP loan as voluntarily terminated and repaid after
disbursement on the 1502 report?
From E-Tran Servicing, search for the SBA loan number.
Once the loan number comes up, click on the voluntary termination button at the top of the page.
This will terminate the loan guaranty. Questions on voluntary termination can be emailed to: For
the Fresno Servicing Center: fsc.servicing@sba.gov; for the Little Rock Servicing Center:
lrsc.servicing@sba.gov.4
What confirmation must the Lender make before receiving PPP processing fees?
Lenders must make a one-time confirmation in the Lender’s FTA Lender portal before SBA will
disburse PPP processing fees to Lender. Lenders will confirm the following:
By checking the “I confirm” box below, the Lender is agreeing that for each SBA Form 1502
report submitted by Lender to request payment of First Draw Loan or Second Draw Loan
Paycheck Protection Program (PPP) processing fees, Lender confirms that:
(1) except for any First Draw Loan included in the report that has been or may be increased, (a)
all First Draw Loans and Second Draw Loans included in the report were fully disbursed to the
borrowers on the disbursement dates entered and in the loan amounts entered in the report, and
(b) Lender will make no further disbursements on the First Draw Loans and Second Draw Loans
included in the report;
(2) for any First Draw Loan included in the report that has been or may be increased, (a) Lender
approved the increase in accordance with PPP requirements, (b) Lender has fully disbursed the
increased amount to the borrower on the disbursement date entered and in the amount entered in
the report, and (c) Lender will make no further disbursement on the First Draw Loan;
(3) all information in the report is true and correct; and
(4) the report has been submitted by an authorized employee or agent of Lender acting within the
scope of Lender’s authority and Lender acknowledges responsibility for all entries and
certifications made on its behalf.
4
The geographic coverage of the Fresno Servicing Center is SBA Regions 5, 6 (except for
Arkansas, Oklahoma and Texas) 7, 8, 9, and 10. The geographic coverage of the Little Rock
Servicing Center is SBA Regions 1, 2, 3, 4, and 6 (except New Mexico and Louisiana).
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When won’t a Lender receive a processing fee?
A Lender will not receive a processing fee:
• Prior to full disbursement of the PPP loan; or
• If the PPP loan is cancelled before disbursement; or
• If the PPP loan is cancelled or voluntarily terminated and repaid after disbursement
(including if a borrower repays the PPP loan proceeds to conform to the borrower’s
certification regarding the necessity of the PPP loan request).5
How will SBA disburse the processing fee to Lenders?
SBA will make PPP processing fee payments to Lenders using the Demand Deposit Account
ACH information supplied by Lenders on the FTA’s website. SBA will make a payment for each
loan on an individual basis so that Lenders will be able to match the received payment with the
corresponding loan. Each disbursement will be made by ACH CCD+, and the addenda record
will use the structured layout that is available in the Downloads section of the FTA’s website.
This structured layout includes payment details that Lenders can use for automating the posting
of these payments to the Lender’s record system. For Lenders unable to automate the posting of
these payments, the record layout should be referenced to determine what the payment is for
when posting the payment manually.
Will SBA review the payment of Lender processing fees?
SBA may review the payment of Lender processing fees at the time of forgiveness purchase or at
any other time SBA deems appropriate. If SBA determines the fee was paid erroneously or in the
incorrect amount, Lender is responsible for repaying the fee to SBA.
Are Lender processing fees subject to claw back if a Lender has not fulfilled its obligations
under PPP regulations?
A lender is required to repay the processing fee to SBA if a lender is found guilty of an act of
fraud in connection with the PPP loan. In such case, the PPP loan is not eligible for a guaranty.
Is a Lender responsible for the actions of its Lender Service Provider (LSP)?
If the Lender authorizes an Agent or Lender Service Provider (as those terms are defined in 13
CFR § 103.1) to submit any information or make any entries or certifications on the Lender’s
behalf for any purpose through the 1502 Dashboard or through any other method of 1502
reporting, the Lender acknowledges that the Agent or LSP is acting within the scope of Lender’s
authority and Lender acknowledges responsibility for all information submitted and entries and
certifications made on its behalf.
5
If the Lender has received a processing fee on a loan that was cancelled or voluntarily
terminated and repaid after disbursement (including if a borrower repaid the PPP loan proceeds
to conform to the borrower’s certification regarding the necessity of the PPP loan request), SBA
will not require the Lender to repay the processing fee unless the Lender is found guilty of an act
of fraud in connection with the PPP loan.
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When a loan is sold, which Lender is responsible for 1502 reporting to SBA?
When a PPP Lender sells all of its interest in a PPP loan to another participating Lender, in bulk
or individually, SBA will send the processing fee to the originating PPP Lender.6 The Lender
making the disbursement is responsible for completing and submitting the initial 1502 report on
loan disbursement. The purchasing Lender will be the party responsible to SBA with respect to
all servicing actions, including monthly 1502 reporting and requests for loan forgiveness, and
will be the party eligible for the guaranty purchase of a PPP loan.
What are the ongoing reporting requirements for PPP loans?
Lenders must electronically submit SBA Form 1502 reporting information to the SBA within 10
calendar days after disbursement of a PPP loan. After submitting the initial SBA Form 1502
report, Lenders must submit PPP loan information to SBA on a monthly basis.
Lenders must provide monthly 1502 reports that include loan status information for their PPP
loans regardless of whether the borrower made a payment in the current month. (All PPP loans
are deferred.)7 Lenders must continue reporting on a loan until the Lender notifies SBA that the
loan has been paid in full.
After a Lender reports a loan as fully disbursed, the Lender must submit monthly PPP 1502
reports on or before the 15th of each month, or if the 15th is not a business day, on the next
business day after the 15th. Lenders must continue to use separate 1502 reports for PPP loans
(including both First Draw PPP Loans and Second Draw PPP Loans) and regular 7(a) loans. The
regular 7(a) loan 1502 report and payment due dates for calendar year 2021 remain unchanged,
as published in SBA Information Notice 5000-20066 issued December 4, 2020.
After a Lender receives a PPP forgiveness remittance from SBA, if no loan balance remains, the
Lender must report the PPP loan as paid in full on the next SBA Form 1502 report. If a loan
balance remains after a Lender receives a PPP forgiveness remittance from SBA, the Lender
must report the reduction in the loan balance for the forgiveness amount on the next SBA Form
1502 report and must service the remaining balance of the loan in accordance with PPP
requirements. The Lender must wait to receive the PPP forgiveness remittance from SBA before
submitting a 1502 report showing the PPP loan as paid in full or a balance reduction due to
forgiveness. Premature 1502 reporting of forgiveness will cause the Lender’s forgiveness
remittance from SBA, if any, to fail validation.
Note: A PPP loan should not be reported as “paid in full” simply because it has been transferred
to another Lender.
6
As discussed in SBA Procedural Notice 5000-20076, processing fees on authorized loan
increases will be paid to the originating PPP Lender.
7
The deferment period runs until (i) the date that SBA remits the forgiveness amount (or notifies
the Lender that the borrower is not eligible for forgiveness) or (ii) for a borrower that does not
submit a timely forgiveness application, 10 months after the end of the loan forgiveness covered
period.
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How do Lenders report a change in the maturity of a PPP loan?
For PPP loans made before June 5, 2020, the maturity is two years; however, borrowers and
Lenders may mutually agree to extend the maturity of such loans to five years. Lenders must
report any such change in the maturity of a PPP loan through E-Tran Servicing.
Questions
Questions concerning this Notice may be directed to the Lender Relations Specialist in the local
SBA Field Office.
Dianna L. Seaborn
Director
Office of Financial Assistance
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