In today’s top news, Treasury Secretary Steven Mnuchin said companies that received Paycheck Protection Program (PPP) loans without qualifying could face investigations, and some small- to medium-sized businesses (SMBs) that received PPP loans said they won’t be able to rehire all of their employees. Plus, facing bankruptcy, Travelex is seeking a buyer.
Companies that received PPP loans could face investigations if they did not meet the criteria for coronavirus relief, Mnuchin said Wednesday (April 22). Some of the bigger firms receiving loans qualified during the self-certification step of the PPP process but may not actually need the money to stay afloat during the pandemic, Mnuchin said.
Some SMBs that received forgivable loans under the PPP say they won’t be able to rehire every employee laid off during the coronavirus pandemic. The PPP will forgive the loans as long as businesses spend 75 percent of the funds on payroll within eight weeks of receiving the money, but SMBs say that economic conditions and the terms of the loan will make rehiring everyone difficult.
Travelex, the British foreign exchange company, is seeking a buyer. The move comes after its parent company, Finablr, said it was in danger of collapsing after it discovered $100 million of undisclosed financing and was not confident of its financial health.
The world remittance fall-off anticipated because of the coronavirus pandemic could have serious effects for numerous countries. The projected decline is expected to be more than $100 billion from what it was last year, draining an important resource used by developing countries like Somalia, Haiti and South Sudan. Those countries could see a 20 percent drop in the remittance flows.
For legacy financial institutions (FIs), winning customers' loyalty often comes down to offering innovative products and services. But with 80 percent of FIs still using legacy core banking systems, digital banks and FinTechs are seemingly at an advantage. In the Digital Banks And The Power Of The Cloud Tracker, Nathalie Oestmann, chief operating officer at aggregated payment card provider Curve, discusses how she thinks flexible, cloud-based infrastructure puts digital banks at an advantage.
As Americans look to cut costs amid financial and economic upheaval, auto insurance may get increased scrutiny as policyholders examine whether what they pay reflects actual risk. Dan Preston, CEO of Metromile, tells PYMNTS why premiums based on miles driven, a digital-first mindset — and an app — may be the wave of the future.
Stripe Co-Founder and President John Collison tells PYMNTS the pandemic has increased the importance of robust digital commerce capabilities. Stripe has announced major updates to its software that will connect users directly with Mastercard, Visa and the world’s other top credit card networks.