Acknowledging the bumpy start to the Payment Protection Program launched April 3, American Bankers Association President and CEO Rob Nichols said the Small Business Association and the U.S. Treasury Department worked with bankers through the weekend to answer questions as lenders provide essential credit to their small business customers.
“We talked to bankers all weekend at small, medium and large banks who are processing loans and getting money out the door… into the hands of those small business women and men who need it so badly,” Nichols said in a CNBC interview on April 6.
Banks and other SBA lenders approved 100,000 loans over the weekend, totalling more than $30 billion, which is “essentially the amount of SBA lending done in 2019 done in one day.”
Treasury Secretary Steve Mnuchin said it will be important for members of Congress and the president to provide more PPP funds when the $349 billion runs low. Mnuchin tweeted on April 7 that he requested lawmakers secure an additional $250 billion for the program.
With anticipated guidance from the SBA and up to 150 lenders being approved to make PPP loans each hour, Nichols expects continued acceleration of the program.
“Lots of progress is being made, [and] we have more to do.” Nichols said. Community banks, midsize banks and large, globally active banks have been working to ensure the economic tail of the crisis is as minimal as possible, Nichols said.
In order to facilitate PPP loans being made through the Small Business Administration’s $349 billion program, the Federal Reserve is creating a facility to provide term financing backed by PPP loans.
This move would provide PPP lenders with liquidity to ensure they can fund the loans authorized by Congress in the Coronavirus Aid, Relief and Economic Security Act.