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Updated: March 19, 2020 at 8:00 am
Helpful Links:
Below is a list of financial services offered by the government.
Not included on the list is yesterday's passing of the second Coronavirus Relief Package.The package allows free Coronavirus testing and paid leave.
Financial Services:
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Cash flow to businesses and consumers: On March 17, 2020, the Fed announced that it will establish a commercial paper facility to support companies and banks providing financing for a wide range of economic activity. For companies, that means helping in their day-to-day operation like making payroll. For household, it means providing funding to financial firms that provide auto loans and mortgages to American families.
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More flexibility: On March 17, 2020, federal bank regulatory agencies announced an interim final rule that facilitates the use of firms' capital buffers to promote lending activity to households and businesses.
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Discount window: On March 16, 2020, federal bank regulatory agencies released a statementencouraging banks to use the Federal Reserve's "discount window" so that they can continue supporting households and businesses.
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Stimulating the economy: On March 15, 2020, the Federal Reserve cut interest rates, bringing the federal funds rate to between 0% and 0.25% to stimulate the economy.
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Increased relief: On March 12, 2020, the New York Fed announced it will inject $1.5 trillion into funding markets to ensure stability in repo market operations and in our financial institutions.
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Pandemic guidance: On March 10, 2020, financial regulators released an update to its pandemic planning for financial institutions to prevent disruption of core operations by the coronavirus.
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Consumer assistance: On March 9, 2020, federal and state bank regulators encouraged financial institutions to work with borrowers and customers affected by the coronavirus.
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Capital markets: The SEC is monitoring the capital markets and on March 4, 2020, provided conditional relief for certain filing requirements for companies affected by the coronavirus including guidance that allows certain in-person board meetings to be done remotely.
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Contingency planning: Regulators are communicating and coordinating with their employees to ensure they are taking appropriate precautions. The SEC became the first federal agency to ask personnel to work from home due to an employee who may have coronavirus.
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Industry outreach: The White House and Treasury Department are communicating and meeting with Wall Street executives to monitor the broader impact of the coronavirus on our financial system and the U.S. economy.
What is being done:
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Monetary relief: The Federal Reserve can make emergency cuts to interest rates and provide liquidity to short-term funding in the repo markets. Last week, the Fed reduced rates from almost 1.75 percent to 1.25 percent and announced it was increasing operations in the repo market from $100 to $150 billion.
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Regulatory relief: Banks have capital and liquidity requirements that limit their ability to lend money, particularly during times of financial stress. The Fed has the authority to adjust both the capital and liquidity requirements of banks that inhibit short-term lending.
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Small business programs: The Treasury Department has numerous small business programs and initiatives to support private sector loans and investments for small and disadvantaged businesses.
Mitigating Coronavirus Impact on Borrowers’ Financial Health:
The Federal Housing Finance Agency (FHFA) and Federal Housing Administration (FHA) have taken steps to remind borrowers of hardship forbearance options.
Key facts:
- FHFA has announced that COVID-19 will trigger protocols similar to a natural disaster.
- Borrowers should contact their lenders directly before missing a payment to report a hardship related to COVID-19.
- Hardship forbearance resources can be used to mitigate the impact of a missed paycheck, lost job, or other financial hardship resulting from COVID-19.
Protecting Consumers from Coronavirus Financial Impact:
The Consumer Financial Protection Bureau (CFPB) has provided useful resources to help consumers protect their families from the financial impact of COVID-19.
Resources:
You have trouble paying your bills or loans: The CFPB and other financial regulators have encouraged financial institutions to work with their customers to meet their needs during the coronavirus pandemic. Borrowers should reach out to servicers and lenders if they anticipate having trouble making their next payment.
You lose your income: State and local governments provide helpful resources for employees impacted by the coronavirus. Additionally, seniors, who are disproportionately impacted by the coronavirus, may be eligible for government benefits available to older adults who need financial help.
You are targeted by a scammer: Scammers are always on the hunt for opportunities to take advantage of consumers. During uncertain times like these, we are especially vulnerable. Learn more about how to spot a scam and report fraud to the appropriate agency.
Prioritizing COVID-19 Response at the Financial Services Committee
Legislative Action
On March 12, 2020, Republican leaders of the Committee introduced eight bills in the ongoing effort to combat the economic and public health impact of coronavirus (COVID-19) through innovation and technology solutions. In response to President Trump’s call for a whole-of-government approach, Republicans are proposing these first steps to help businesses of all sizes, employees, and American consumers in the midst of this public health crisis:
The Crowdfunding to Combat the Coronavirus Act
Introduced by Ranking Republican Patrick McHenry (NC-10), this bill creates a $1 billion prize for creating a COVID-19 vaccine that must be affordable and widely available. Additionally, it eliminates offering ceilings in Regulation Crowdfunding, Reg. A, and Reg. A+ for startups and small businesses working to combat COVID-19, providing support for job creators while encouraging medical innovation that could save lives.
The Relief for Small Businesses Through Micro-Offerings Act
Introduced by Ranking Republican Patrick McHenry (NC-10), this bill would create a new micro-offerings exemption to allow broader access to capital for entrepreneurs and small businesses. This provides necessary support to concerned job creators whose workforce or product may be negatively impacted by COVID-19 and any shortage in traditional bank lending. Micro-lending has a demonstrated track record for providing much-needed capital to entrepreneurs—often women and minorities—in underbanked communities, helping them start and grow their businesses.
The Touchless Transactions Act
Introduced by the Ranking Republican of the Subcommittee on National Security, International Development, and Monetary Policy, French Hill (AR-2), this bill would establish that any swipe, dip, or tap transaction at a merchant point of sale terminal would not trigger a signature requirement. Thanks to innovation in credit and debit transaction verification, signatures for such transactions are no longer necessary and eliminating the practice can cut down on the spread of the virus.
The Gig Economy Infrastructure Act
Introduced by Ranking Republican Patrick McHenry (NC-10), this bill expands the category of workers that can be compensated with equity compensation to gig workers. Gig workers can be food delivery couriers, contract workers, or rideshare drivers, just to name a few, and are critical in our technology driven world. This bill provides support to these workers and ensures they can continue to serve our communities in this environment.
The SEC Relief to Slow the Spread of Coronavirus Act
Introduced by Ranking Republican of the Subcommittee on Investor Protection, Entrepreneurship, and Capital Markets, Bill Huizenga (MI-2), this bill would remove requirements for in-person meetings and hand-delivery of certain SEC-required documents. This will allow for minimization of face-to-face contact based on regulatory requirements of the federal securities laws.
The Insured Depository Institution Business Continuity Planning Act
Introduced by Vice Ranking Republican, Ann Wagner (MO-2), this bill would provide federal banking regulators with the authority to promulgate safety and soundness standards for business continuity planning and management.
The Coronavirus Guidance for Financial Institutions Act
Introduced by the Ranking Republican of the Subcommittee on Housing, Community Development, and Insurance, Steve Stivers (OH-15), this bill supports the Trump Administration’s efforts to encourage financial institutions to work with consumers and businesses impacted by COVID-19. This would also require regulators to issue a report to inform Congress and the American people on the effectiveness of the directive.
The Coronavirus Accounting Relief Act
Introduced by the Ranking Republican of the Subcommittee on Consumer Protection and Financial Institutions, Blaine Luetkemeyer (MO-3), this bill would delay the implementation of an ill-advised accounting standard, the Current Expected Credit Losses (CECL), that forces institutions to increase credit losses and decrease lending at the most inopportune time. Delaying the implementation of CECL will free up billions of dollars for financial institutions to lend to small business and consumers in need.
Letters to Key Officials
On March 16, 2020, Republican Committee leaders, led by Ranking Republican Patrick McHenry (NC-10), sent a letter to Consumer Financial Protection Bureau (CFPB) Director, Kathleen Kraninger, asking for her assistance in protecting seniors from coronavirus-fueled scams.
On March 16, 2020, Republican leader Patrick McHenry (NC-10), and Republican leader of the Subcommittee on Housing, Community Development, and Insurance, Steve Stivers (OH-15), sent letters to the nation’s largest Public Housing Authority (PHA) leaders urging them to implement policies to protect vulnerable residents from the coronavirus.
On March 10, 2020, Ranking Member Patrick McHenry (NC-10), along with Financial Services Committee Republican leaders, wrote a letter to Secretary Steven Mnuchin in his role as the chair of the Financial Stability Oversight Council (FSOC), to request FSOC convene a meeting to ensure they are prepared to address the potential threat of coronavirus to our financial system.
In addition, the Committee leaders urged the Council to provide recommendations to member agencies to ensure business continuity and to mitigate this growing health crisis.
Secretary Mnuchin has since convened the President’s Working Group on Financial Markets to gather information on the resilience of the markets and the economic impact of COVID-19, and has scheduled a meeting of the full FSOC for March 23rd to further address these concerns.
Check back regularly for additional details and visit https://www.cdc.gov/coronavirus/2019-ncov/index.html for health resources and updates on COVID-19.
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