June 19, 2020—The U.S. House of Representatives Committee on Small Business held a hearing to go over challenges borrowers and lenders face, according to a press release from the Automotive Service Association.
According to the release, the hearing titled, “Paycheck Protection Program: Loan Forgiveness and Other Challenges,” went over Paycheck Protection Program (PPP), the challenges of applying for and using the loans, and additional suggestions for optimizing the program.
The original PPP provided billions of dollars for small businesses to remain open during the COVID-19 pandemic. However, restrictions in the law and confusion with rolling out of the program caused borrowers to become hesitant in applying for the loan in the first place.
In response to these obstacles, the PPP Flexibility Act was recently passed, addressing issues such as the 75/25 rule and extending the coverage period from eight weeks to 24 weeks.
Committees in the U.S. House and Senate have continued to hold hearings on the roll out and implementation of the program as these loans have been critical to the economic recovery of small businesses nationwide.
Prior to the hearing, according to the release, House Small Business Chairwoman Nydia Velazquez sent a letter to committee members, calling on the administration to begin publishing demographic data on the PPP and Economic Injury Disaster Loan (EIDL) programs.
