In yet another blow to small businesses trying to save their companies, the Small Business Administration (SBA) acknowledged on Tuesday that its website suffered from a glitch that allowed "personally identifiable information" about thousands of companies to leak online.
The SBA sent notifications to nearly 8,000 companies on Tuesday, saying that information they shared in their Economic Injury Disaster Loan (EIDL) applications may have been exposed to other applicants. In a statement to CNBC, the SBA said that it "immediately" fixed the flaw after discovering the bug, and it should no longer be a problem.
Not to be confused with the Paycheck Protection Program, EIDL loans are alternative funding options for companies affected by the coronavirus outbreak. Applicants are able to get low-interest loans from the SBA that are payable up to 30 years to help them fund their operations. EIDL loan applicants are also eligible for loan advances up to $10,000 that would not need to be paid back.
The revelation is just the latest black eye for the SBA and banks in general, after small and medium sized businesses around the country were unable to qualify for PPP funding before the $350 billion allocated to the program ran out. The federal government is planning to pass a measure this week that could recapitalize the PPP fund, but there are still no guarantees that every company that can qualify will actually get the funding their desire.
It's unclear when exactly the companies exposed to the EIDL loan glitch may have been impacted. However, the agency told impacted companies that they can qualify for one free year of credit monitoring to ensure they don't fall victim to identity theft. So far, the SBA told CNBC, there has been no indication of wrongdoing among those who viewed the personal information.
What this means for businesses, however, is a different story entirely. Companies dealing with losses of revenue, layoffs, and countless other problems, now need to worry about their personal information leaking. It's a pile-on that those companies didn't need. And hopefully, it's an error that the SBA won't make again.