Why Didn't I Get My PPP Loan?

You may have been one of the businesses that pounced on the hastily assembled Paycheck Protection Program in hopes of getting a loan. Many businesses succeeded, but some did not, and it's not always clear why. If you didn't, here are some clues why.

Your first call should be to the lending institution. PPP loans don't come directly from the Small Business Administration or another government agency, but from banks approved to work with the SBA. There is no universal portal to track your loan or uncover reasons for delays or rejections. Your contact at your bank or your bank's own loan portal might be able to help you.

Also, here are some other items that might be holding you up, according to SmartAsset, a personal financial technology company.

Failure to document employee costs. This error is especially common with sole proprietorships. Owners should make sure they are listing actual employees and not contract workers. If you don't have any actual employees, you may still be OK — PPP loans are available for gig workers, sole proprietors and independent contractors. But you have to have your papers in order.

Franchise confusion. Franchised businesses are eligible for PPP loans but need to be in the SBA franchise directory. If you're having trouble, make sure you're on the list. If not, contact the SBA about how quickly you can get on it.

Failure to meet key qualifications. SmartAsset notes that if you were not in operation before Feb. 15, 2020, you won't be considered. Also, businesses with a 20% owner with a prior felony conviction or guilty plea will be rejected.
​
Excluded businesses. Certain business classes were initially excluded, such as banks, investment companies, passive real estate investment companies and speculative trading firms, according to the National Law Review. But there is some gray area here: Some registered investment advisors, for example, were initially rejected, but found on reapplication they were accepted, according to Wealthmanagement.com. If you were rejected because your business class is excluded, you may have to have a conversation with the SBA if you believe you are in an acceptable group.