Congressional action on PPP forgiveness, liability protections needed
Credit unions have numerous Paycheck Protection Program concerns that could be alleviated by Congressional action, CUNA wrote to the Senate Small Business Committee Wednesday. Credit unions helped facilitate more than 170,000 PPP loans averaging $49,000 per loan.
“Now that the PPP program has transitioned to the loan forgiveness phase, credit unions are concerned that the loan forgiveness process is overly complicated for most businesses,” the letter reads. “The process is so complex that most businesses may need to retain counsel to navigate the application process – an expense many of the smallest businesses cannot afford during normal times, much less in this crisis.”
CUNA strongly supports legislation introduced in both chambers that would allow simple forgiveness for PPP loans under $50,000.
CUNA also remains concerned about:
- Small Business Administration loan necessity questionnaires, as the review process could adversely affect borrowers and lenders;
- PPP related liability due to a lack of guidance of certain PPP aspects. CUNA calls on Congress to “enact commonsense liability protections” for PPP lenders.
The letter also recommends, should the PPP be reauthorized, the SBA:
- Improve national and regional operations to provide more timely feedback to lenders and borrowers, including:
- Lender prioritization guidance;
- Official guidance formalizing the use of PPP forms; and
- Guidance on the loan purchasing process.
- Issue guidance and forms to reflect that privately insured state-chartered credit unions are eligible to lend through the program.