Q: Are banks required to report SBA Paycheck Protection Program (PPP) loans to the credit bureaus? I thought that SBA 7(a) loans are required to be reported, but I don’t know if this extends to PPP loans.
A: You are right that there is a general requirement to report SBA loans. That being said, this requirement was not specifically cross referenced in the PPP rules, so it’s currently still not clear whether this requirement extends to PPP loans. While the intent does not appear to be to require institutions who currently do not report to begin the reporting process for PPP loans, the bank will ultimately have to make an internal judgment call until further guidance is issued.
2. Reports to Credit Reporting Agencies In accordance with the Debt Collection Improvement Act of 1996, Lenders are required to report information to the appropriate credit reporting agencies whenever they extend credit via an SBA loan. Thereafter, they should continue to routinely report information concerning servicing, liquidation, and charge-off activities throughout the life-cycle of the loan. (See Chapter 26 for more information regarding credit reporting requirements for loans in charge-off status.)
SBA SOP 50 57 2, p. 28: https://www.sba.gov/sites/default/files/files/SOP_50_57_2_1.pdf
Compliance Alliance offers a comprehensive suite of compliance management solutions. To learn how to put them to work for your bank, call(888) 353-3933 or email info@compliancealliance.com and ask for our Membership Team.
Not a member? Learn more about membership with Compliance Alliance by attending one of our live demos:
Compliance rules and regulations change quickly! For timely compliance updates, subscribe to Compliance Alliance’s email newsletters.
