ARLINGTON, Va.–With the Paycheck Protection Program now having exhausted close to a trillion dollars in funding, the next big question for credit unions and borrowers alike will be the loan forgiveness process.
Companies that followed the rules, which were tweaked and changed at various times during the three different phases of PPP funds disbursement, are supposed to have the amounts “borrowed” forgiven.
But just like the PPP itself, many analysts expect there will be plenty of glitches in the forgiveness process, which will be another first-time experience for the Small Business Administration, which is administering the PPP.
Carrie Hunt, SVP and general counsel with NAFCU, agrees there will likely be some “problems” ahead, although no one has any idea at this point how big or complex those may be.
There was a “lot of rushed and scant guidance,” said Hunt of the initial roll-out of the program. “That’s not the fault of the SBA, it’s just the result of the huge lift of this program. Financial institutions, including credit unions, were working fast and furiously to get these loans out. Certainly, there could be some issues with the documentation and other work that was done.”