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Small Business Administration (SBA) Administrator Jovita Carranza Monday sent a message to lenders participating in the paycheck protection program (PPP) encouraging them "to redouble [their] efforts to assist eligible borrowers in underserved and disadvantaged communities." More than 700 credit unions with assets of less than $1 billion are PPP lenders, and the most recent PPP loan data demonstrates their commitment to reaching the smallest businesses in need.

PPP loan data released by the SBA Friday revealed these credit unions' average loan size is about $50,000, compared to the total program's average of $112,000.

"SBA wants to ensure that entities in underserved and rural markets, including veterans and members of the military community, small business concerns owned and controlled by socially and economically disadvantaged individuals, women, and businesses in operation for less than two years benefit from the PPP," Carranza wrote to lenders.

She called on lenders to focus on these entities ahead of the June 30 deadline to issue new PPP loans; $129 billion of PPP funds currently remain.

As Congress and the SBA and Treasury work to ensure the smallest businesses and those most-in need of PPP loans receive them, NAFCU has supported set asides for Community Development Financial Institutions (CDFIs), smaller lenders, and businesses that are women-, minority-, or veteran-owned. The association has called for a number of other improvements to the PPP program to support small lenders and borrowers, including simplifying the loan forgiveness process and granting automatic forgiveness for loans under $150,000.

In addition, the SBA released an interim final rule revising eligibility of businesses that are owned by people with felony criminal histories. The look-back period is now one year – from the previous five years – for applicants who have been convicted of, pleaded guilty to, pleaded nolo contendere, or been placed on any form of parole or probation for non-financial felonies. The look-back period remains five years for felonies involving fraud, bribery, embezzlement, or a false statement on a loan application or an application for federal financial assistance.

Access NAFCU's PPP FAQs here; more information is also available on the SBA's and Treasury's websites.