ABA Urges SBA to Provide Guidance to Banks on Coronavirus Relief

As the Senate moved closer to passage of a coronavirus relief package today, ABA joined a coalition of financial services trades in a letter to U.S. Small Business Administrator Jovita Carranza seeking “clear and consistent guidance” on how SBA intends to enact forthcoming changes to its 7(a) loan program. The groups urged SBA to provide “bright-line rules, free from ambiguity.”

The new law authorized $350 billion in funds for a temporary expansion of the program to ensure that small businesses facing extreme financial hardship during the coronavirus pandemic can meet critical costs including payroll, rent and utilities. It also allows virtually any lender to apply to become a 7(a) lender and increases the funding level for existing 7(a) loans.