SBA must address backlog of PPP loan forgiveness applications
The Small Business Administration should work to provide certainty for Paycheck Protection Program (PPP) loan forgiveness applications, CUNA wrote to the House Small Business Committee Tuesday for its hearing on SBA pandemic response programs. End-of-year appropriations legislation in December contained CUNA-supported forgiveness language for PPP loans under $50,000, but there is a large backlog of forgiveness applications that have not received a response from the SBA.
“Under the SBA’s own Interim Final Rule, the SBA is required to issue a decision within 90 days after a forgiveness application has been received. Despite the Interim Final Rule, businesses and financial institutions are waiting well past the deadline for a response,” the letter reads. “While we understand there is a high volume of loan forgiveness applications, small businesses and financial institutions need certainty on the status of their applications. We urge SBA to address these delays with loans forgiveness applications and to ensure that SBA has adequate staff in place to provide customer service in the upcoming months.”
CUNA also urged “swift passage” of bipartisan legislation that would exempt credit union member business loans from the cap for up to one year past the declared national emergency.
“With many credit unions approaching or at the 12.25% of assets cap, we conservatively estimate that even temporarily removing the MBL cap will provide over $5.5 billion in capital to small and informal business ventures, creating nearly 50,000 jobs over the course of the next year…Small businesses and communities around the country are suffering and need access to relief,” the letter reads. “Providing credit unions flexibility to temporarily exceed the MBL cap would not only provide small businesses and consumers with the assistance they need immediately, but also stimulate the economy in the long term.”