ARLINGTON, Va.– In advance of yesterday’s hearing by the House Financial Services Committee that reviewed the HEROES Act, NAFCU sent a letter in which it outlined ways credit unions are working to provide their members with financial support and relief amid the pandemic and ways Congress can bolster those efforts.
In the letter, NAFCU VP-Legislative Affairs Brad Thaler told Congress credit unions “have also stepped up to ensure small businesses in their communities are taken care of during these uncertain times.”
"The Small Business Administration’s (SBA) Paycheck Protection Program, created by Title I of the CARES Act, has been very successful and an important tool that credit unions have used to help their small business members, and we thank you for including credit unions as lenders in this program,” wrote Thaler. “Still, even with the success of the PPP, there remain some issues that we believe need to be addressed such as the simplification of the loan forgiveness process."
Thaler also noted NAFCU’s call for a simplified loan forgiveness process and automatic forgiveness for loans under $150,000.
Support for Provisions
The NAFCU letter also expressed for other HEROES Act provisions, including
- Increasing the guaranteed portion for existing SBA loans, which are exempt from credit unions' member business lending (MBL) cap and would allow credit unions to make more small business loans
- Increasing the maximum loan amount for SBA 7(a) and 504 loans
- Providing $1 billion in emergency funding for the CDFI Fund
Proposals Made
Thaler and NAFCU offered several additional proposals the trade group wants Congress to consider, including:
- Providing relief from the MBL cap and supporting bipartisan legislation to do so
- Amending the Federal Credit Union Act's 15-year general maturity limit for most credit union loans to extend the limit
- Allowing a temporary reduction in credit unions' capital standards on par with what community banks received under the CARES Act
- Increasing funding for the NCUA's Community Development Revolving Loan Fund (CDRLF)
- Making changes to the NCUA's Central Liquidity Facility (CLF) permanent
- Modernizing the E-SIGN Act
- Allowing all credit unions to add underserved communities to their fields of membership.