With the US government's small business rescue program commencing today, the interest rate on small business loans offered through the $2 trillion CARES Act was doubled from 0.5% to 1% in response to banks who were afraid they would lose money on the loans. The Treasury Department and the Small Business Administration also assured banks they would not be penalized if borrowers don't follow the program's rules.
Smarsh has joined Microsoft's One Commercial Partner Program in an initiative aimed at helping financial firms keep up with their compliance requirements as teams work remotely amid the coronavirus pandemic. Smarsh's Enterprise Archive will be used to store and index firms' communications data in Microsoft programs.
Federal Housing Finance Agency director Mark Calabria says mortgage giants Fannie Mae and Freddie Mac could need additional federal funds if the US economy stays under lockdown for more than 12 weeks.
Fintech companies are hoping Congress and the Trump administration will consider them as a way to distribute stimulus checks from the CARES Act. Banks have a longer process than fintech startups for getting cash in the hands of people, according to Scott Stewart, the head of the Innovative Lending Platform Association. As a proof of concept, Chime fronted the funds, selected 1,000 of its users and sent them the money.
Modern Money Murmurs: The Treasury Department should seriously consider leveraging fintech to help distribute stimulus checks. Like so many other aspects of this rescue, there are details that have to be worked out, but with reports suggesting some checks won't be distributed by the IRS until as late as September, every option should be explored to speed up the process. Timing is of the essence.
The Trump Organization has asked Deutsche Bank to defer its payments on certain property loans, sources say. The company is reportedly facing disruptions to many of its properties amid the coronavirus pandemic.
No other health crisis has affected the stock market like the coronavirus pandemic and personal containment and social distancing are among the reasons, an analysis finds. While the severity of the outbreak is partly a factor, previous pandemics with high mortality rates do not appear to have driven stock movements as drastically as COVID-19, the analysis finds.
Americans who do not have direct deposit information on file with the Internal Revenue Service may not see their stimulus checks until September. Anyone who have previously provided direct deposit information to the IRS could see their money the week of April 13.
Regions Bank created a web page for small business owners who want more information on government-backed loans, and bank officials say they plan to process the loans as quickly as possible. Banks have just received guidance on how to administer the $349 billion loan program and customers are asked to be patient, said Richard Hunt, president and CEO of the Consumer Bankers Association.
Banks have the systems in place to accommodate the $349 billion Paycheck Protection Program but the application process required by the government may slow the process, said Consumer Bankers Association spokesman Nick Simpson. Some banks are wanting more information on the loan process.
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