WASHINGTON—CUNA, NAFCU and numerous other financial services organizations are raising new concerns with the Paycheck Protection Program (PPP) loan submission process and E-Tran access issues while the trade groups sent a separate letter
In a letter to Small Business Administration Administrator Jovita Carranza, the organizations signing the letter said their constituents have helped 1.7 million businesses get loans during the first round of PPP funding, but said issues must be resolved if small businesses impacted by the pandemic to succeed, CUNA stated.
As CUToday.info reported, after running out of the initial $349 billion in funds in the program’s first two weeks, it was reauthorized last week with an additional $310 billion, starting Monday morning.
“Unfortunately, with the start of the second round of funding many lenders are having significant problems submitting loan applications into the SBA’s system, preventing them from delivering this critical financial assistance to small businesses that desperately need it. Quite simply, it is taking too long to submit loans and get these funds where they need to go,” the letter reads. “We respectfully request that you help us resolve these access issues, or at least explain to our members what is causing the problem.
‘How Will it Be Resolved?’
“Additionally, we encourage transparency to help us explain to our members what is causing the problem and how it will be resolved,” it adds. “If the pace and performance of the E-Tran system cannot be improved, then we ask that you share that information with the public to help manage expectations for all of the small businesses still counting on PPP for a lifeline… we have found the lack of transparency and timely guidance on the PPP process impedes the funding of loans to small businesses in need. The SBA should continue to collaborate with the Treasury to provide timely and consistent guidance to financial institutions as they work to provide their communities with this critical assistance.”
The organizations added that the “sooner this program functions properly, the sooner more small businesses are able to receive the assistance they critically need.”
The Signatories
Other organizations signing the letter: the American Bankers Association, Bank Policy Institute, Community Development Bankers Association, Consumer Bankers Association, Financial Services Forum, Mid-Size Bank Coalition of America, and the National Bankers Association.
Letter on EIP Issues
In a separate letter, CUNA and NAFCU joined with bank trade groups in a letter to the Treasury Secretary Steven Mnuchin regarding issues with the safe and secure delivery of Economic Impact Payments (EIPs) to more than 100 million Americans under the CARES Act.
"We believe that maximizing electronic disbursements and minimizing paper payments will benefit individual recipients and the country," the letter reads. "The EIP process can be made even more efficient for recipients and the financial services industry if additional clarity is gained in certain operational areas. The undersigned associations have enclosed with this letter a list of questions for the Department of the Treasury – answers to which will provide guidance to financial institutions currently processing electronic and paper check transactions. This important information will help get much-needed relief payments to recipients faster. The responses will not only provide clarity in the near-term, but will also serve as a guidepost for any future relief payment initiatives that may be forthcoming."
The letter called on Treasury officials to review a Wall Street Journal indicating the Department of the Treasury shall seek the return of EIPs sent to the deceased via paper check and Automated Clearing House (ACH) payments, saying the report is contrary to guidance previously provided by Treasury, and contravenes both Nacha Rules and Treasury’s own Green Book that govern federal ACH payments.
"To reduce confusion amongst recipients and their financial institutions, we request that this matter be addressed with all due haste," the letter states.
The full letter can be found in CUToday.info's The Gov.