How Banks Stand to Make $18 Billion from PPP Loans Processing.

News • 2020/07/15 • by

The Washington Center for Equitable Growth released a new report detailing the likelihood of financial organizations to close down on 3% of the aggregate total PPP relief loans. The loan payout is estimated to reach the tune of $64billion, and the 3% charge will be for the standard processing of the funds. Amanda Fischer Policy, who is the Director of Washington Center for Equitable Growth’s (WCEG), stated that banks would be making around $18billion for processing fees committed to the CARES Act.

Further, bringing to light the possibility of banks having significant profits, she added that “If such loans are distributed through a public institution instead, the state will be saving over $140 billion.Fischer also suggested that conventional banks adding standard fees as risk insurance could be a sheer rip off of the country. Since the government provides PPP loans, chances of banks accepting funky PPP loans are hugely slim. “Ultimately, the state will be giving free money if they went on with paying outrageous traditional bank fees.

The CARES Act: Exemplifying How America’s Government Exhibits its Corrupt Practices During Times of Crisis

The CARES Act has been known to raise controversy even before its signing by Donald Trump. For instance, when Thomas Massie, a member of the US House of Representative, revealed publicly that the stimulus bill encourages a degree of secrecy, which is also linked to the Federal Reserve. Not only that, but also, the law has been scrutinized for finding hospitals, long term care centers, and nursing homes, which were financial setbacks before the CoronaVirus pandemic. As such, similar organizations have been accused of inflating the number of cases and deaths.

Thus, there are two directions of blames when it comes to unwarranted monetary expenses supported by the CARES ACT. The first is that the government is opening doors for banks to loot the country, and secondly, the government may have also exaggerated its reaction to the breakout of the virus.