May 18, 2020
CONTACT: Shelton Roulhac, NASCUS Communications; email@example.com
NASCUS SEEKS ENHANCEMENTS TO THE PAYCHECK PROTECTION PROGRAM, INCLUDING LOAN FORGIVENESS CLARITY AND THE INCLUSION OF NON-FEDERALLY INSURED CREDIT UNIONS AS ELGIBLE BORROWERS
NASCUS commends the Small Business Administration for launching the unprecedented Paycheck Protection Program but calls on the agency to assist state regulators and credit unions properly implement the program with notable enhancements.
ARLINGTON, Va. – In response to the Small Business Administration’s (SBA’s) request for comments on the Interim Final Rule (IFR) implementing the Paycheck Protection Program (PPP), NASCUS has written a comment letter urging the SBA to improve the PPP to assist state regulators and credit unions administer the program.
“Of course, the PPP and its particular restrictions on the use of loan proceeds and loan forgiveness calculations are going to be unfamiliar to lenders and borrowers,” said NASCUS Executive Vice President and General Counsel Brian Knight. “It will be essential for the SBA to establish rules that are easy to understand and implement. Credit unions and the credit union system stakeholders have worked diligently at the retail level to implement the PPP. We urge the SBA to expeditiously publish the rules needed to move forward with successful implementation of the remainder of the program.”
The NASCUS letter recommends six significant enhancements:
- Rules governing the SBA’s forgiveness of qualifying loans must be promulgated promptly and the parameters of the loan forgiveness must be easy for borrowers to understand and lenders to implement
- The SBA should recognize that non-federally insured credit unions are safe, sound, and closely supervised and should be included as eligible lenders
- The SBA should require lender concurrence of the use of borrower agents as a prerequisite for payment of fees
- Safe harbors for lenders acting in good faith to implement elements of the PPP where guidance was lacking at the time of the lender’s decisions should be created
- The IFR provisions should be amended to include the specific instructions, metrics and references to forms needed to administer the PPP
- The current IFR, the pending IFR on loan forgiveness, all other modifying rules, and existing PPP specific guidance should be reorganized and codified as a single regulation for ease of reference
The NASCUS comment letter is available here.
Shelton Roulhac, Vice President, Communications, firstname.lastname@example.org or (703) 528-5974
NASCUS is the national association that advocates for a strong and healthy state credit union system, and whose members include state regulatory agencies, credit unions, credit union leagues, and organizations that support the state credit union system.