Credit union groups tell Congress PPP action ‘cannot wait’
Credit union groups on Thursday called on Congress to take bold steps to keep cash flowing to small businesses across the country after the Small Business Administration’s Paycheck Protection Program ran out of money just two weeks after launching.
“As millions of small businesses and communities across the country confront a public health crisis caused by the coronavirus outbreak, policymakers must make sure it does not snowball into a full-fledged economic crisis too,” said Dan Berger, president and CEO of the National Association of Federally-Insured Credit Unions.
He added: “Today, many credit unions have a large number of pending loan applications from small business owners looking for emergency financial assistance. With credit unions heavily engaged in serving underserved communities, which have been hit the hardest during this economic downturn, it is imperative policymakers set aside a portion of additional funding for credit unions.”
Jim Nussle, president and CEO of the Credit Union National Association, called on lawmakes to move past an impasse in order to keep funds flowing.
“Credit unions have been instrumental in getting these needed funds to small businesses around the country over the past few weeks, and it’s clear that these funds are providing a needed lifeline to impacted businesses,” he said. “We urge Congress to come together on a deal to add additional funds, as it’s clear that as the effects of the pandemic continue, more businesses will find themselves impacted.”
Some state-level groups have also chimed in. The Michigan Credit Union League joined more than 30 other groups from across the state — including the Michigan Bankers Association, Michigan Farm Bureau, the state’s Economic Development Association and multiple chambers of commerce — in a letter to the state’s congressional delegation, noting that more than 25,000 loans totaling $8.5 billion were approved for businesses in that state alone.
“While we understand there are other ideas on the table and a possible ‘Phase Four’ deal coming together, this matter cannot wait,” the letter read. “We urge swift congressional action, including program enhancements and additional funding so the business community and financial institutions can continue to distribute these desperately needed dollars to small businesses, which form the economic core of our communities.”
Despite the push for increased funds, the program hasn’t been entirely popular. Some of the nation’s largest credit unions aren’t taking part in it, and some of those that are have run into problems since its rollout.
Miriam Mitchell, SVP of lending at the $2 billion-asset Addition Financial in Lake Mary, Fla., said it took the credit union several days just to get the first applications submitted to the program, in part because some members had to reapply after the application changed midway through.
“It definitely has not been as simple as we thought it would be based on everything we heard in the media,” Mitchell said.