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The Small Business Administration (SBA) and Treasury Department Wednesday released updated FAQs for the paycheck protection program (PPP) clarifying that loans for less than $2 million "will be deemed to have made the required certification concerning the necessity of the loan request in good faith."

The SBA is also reminding lenders to complete the data request sent through the CAFS Login System secure email system by the Office of Capital Access by 5 p.m. Eastern today.

The SBA previously asked borrowers to assess their economic need for a PPP loan (Question No. 31). Those that did not meet the required certification in good faith are able to repay their loan in full by Monday (Question No. 47).

In the new FAQ (No. 46) granting the safe harbor for loans less than $2 million, the SBA determined it is "appropriate because borrowers with loans below this threshold are generally less likely to have had access to adequate sources of liquidity in the current economic environment than borrowers that obtained larger loans."

It also addresses how borrowers with loans over $2 million can make the required good-faith certification and what to do if the SBA determines the loans were not obtained in good faith during its review. For lenders, the SBA clarifies that its determination of the necessity of a loan request will not impact its loan guarantee.

Also Wednesday, the House Small Business Committee held a virtual forum with several PPP stakeholders, representing lenders and businesses, to discuss the program's impact and areas that still need to be addressed. Many of the issues aligned with the recent Office of Inspector General report that identified areas that need more guidance and clarity.

The panelists stressed that more guidance is needed, especially as it relates to loan forgiveness as many borrowers are fearful they will be burdened with large amounts of debt. NAFCU last month wrote SBA Administrator Jovita Carranza calling for guidance on this issue and is monitoring congressional efforts to make changes to the PPP, including eliminating the requirement that at least 75 percent of the PPP loan forgivable amount must be used toward payroll.

In addition, Dafina Williams, whose organization represents Community Development Financial Institutions (CDFIs), highlighted the benefits of setting aside PPP funds for smaller, community-based financial institutions to get loans to smaller businesses in need. NAFCU has called for additional set asides in future funding packages. Some of the panelists also brought up the need to clarify that small businesses can deduct eligible expenses that were paid for by forgivable PPP loans from their taxes.

NAFCU will continue working closely with the SBA, Treasury, and Congress to ensure credit unions can lend effectively through the PPP. Access NAFCU's PPP FAQs here; more information is also available on the SBA's and Treasury's websites.