Federal Reserve Chairman Jerome Powell said about 300 lenders have signed on to the program and that the central bank is committed to making adjustments that could attract more borrowers.
Worried about a lack of demand and that some of their customers are ineligible, community banks are still on the fence about participating in the effort to back loans for businesses recovering from the pandemic crisis.
The inability of Democrats and Republicans to agree on a chairperson and lack of sufficient personnel have made it harder for the commission from doing its job — hold Treasury and the Fed accountable for implementing the coronavirus relief law, observers say.
At a congressional hearing, Fed Chairman Jerome Powell discussed steps to get the flow of coins to financial institutions back to pre-pandemic levels, as well as ways to ease other industry burdens.
The Fed chairman updated senators about the agency's new credit facility for midsize firms struggling in the pandemic. He also left open the possibility of additional stress tests to gauge the industry’s coronavirus response.
Evidence suggests some minority-owned businesses can’t access loans, and the Trump administration is under pressure to report borrower demographics. The issue is gaining attention against the backdrop of protests over the George Floyd killing.
The lawmakers cited concerns from small businesses that the current application to have coronavirus relief loans forgiven is “especially burdensome, time-consuming, and costly.”
The central bank is only now nearing the launch of the credit facilities after the effort was announced in April. But Chairman Jerome Powell said loans have been available through other means.
Members of the Small Business Committee signaled backing for broadening Paycheck Protection Program access for the smallest companies, encouraging participation by nonbank lenders and other improvements.
