WASHINGTON–A group of Democrats in Congress want the Small Business Administration to reserve an additional $10 billion as part of its coronavirus relief programs for lenders that serve minority and rural communities.
As CUToday.info has reported, the new $310 billion round of funding for the Paycheck Protection Program sets aside $60 billion for smaller institutions, such as credit unions, under $10 billion in assets to process for their customers/members.
But the members of Congress, including House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer, along with eight other senators, say more funds should be earmarked for Minority Depository Institutions (MDIs) and Community Development Financial Institutions. MDIs are any bank or savings institutions that have either 51% of their voting stock owned by minority individuals, or a majority-minority board of directors as well as a largely minority clientele.
The House and Senate leaders sent separate letters to the SBA outlining their concerns.
Areas are ‘Underserved’
“We must ensure that federal recovery funding reaches businesses that have been underserved by mainstream lending institutions in the past,” the letter reads. “These institutions’ specific mission to serve low-income, rural and minority small business owners and communities uniquely positions them to increase the amount of PPP loans that reach our underserved businesses.”
The letters raise separate concerns around how the PPP and other relief funds are being used, including the Economic Injury Disaster Loan grants, which the letter suggests have been unfairly limited in scope.
Moreover, the Democratic lawmakers also want the emergency loan relief programs opened to farmers and other agricultural enterprises.