Credit Union Journal, July 28, 2020: Will GOP plan to slash unemployment aid trigger wave of loan defaults?
As lawmakers debate another round of stimulus to ease the economic effect of the pandemic, some in the industry say a GOP proposal to scale back unemployment benefits tied to the coronavirus could come back to bite financial institutions.
Senate Republicans unveiled follow-up legislation this week to the Coronavirus Aid, Economic Relief and Security Act that would cut the enhanced unemployment benefits to $200 per week through September, down from $600.
While the unemployment aid combined with other relief has up to now helped Americans stay current on their debt and maintain consumer spending, many worry that slashing the amount of the unemployment coverage will put a strain on credit quality.
