ABA, State Associations Call for Guidance on Payment of Agent Fees for PPP Loans
August 3, 2020
ABA and all 51 state bankers associations wrote to the Treasury Department and the Small Business Administration on Friday urging formal guidance to address confusion regarding fees paid to agents who process PPP applications.
Lenders and borrowers have the option to work with agents to process PPP applications, and agents may be compensated out of the lender’s fee paid by SBA for each application. However, lenders have raised concerns about a lack of clarity between agents who are providing a legitimate service to the borrower and agents initiating these relationships without lender consent and then seeking payment.
The associations urged SBA and Treasury to codify in guidance that the payment of agent fees should be based upon a contractual relationship between the lender and the bank. “Banks of all sizes will continue to support their business customers and do their part to spur the economic recovery to come,” the groups wrote. “We all share the same goal of making sure businesses receive these much-needed PPP loans during this time, but want to make sure there is a clear understanding of how the lender-agent-borrower relationship works and that it is being acted on in good faith.” Read the letter.