H.R. 4551: Employee Paycheck and Small Business Protection Act
The Employee Paycheck and Small Business Protection Act aims to amend the Federal Deposit Insurance Act and the Federal Credit Union Act in several key ways related to deposit insurance for businesses and the establishment of a temporary transaction account guarantee program.
Expanded Insurance Coverage for Business Payment Accounts
The bill proposes to expand the insurance coverage for business payment accounts held at banks and credit unions. This means that businesses, non-profits, municipalities, and similar organizations will have their accounts insured up to $100 million instead of the standard lower limits. This expanded insurance will apply to accounts used mainly for transactions like payroll and vendor payments that do not earn significant interest.
Temporary Transaction Account Guarantee Program
The bill establishes a temporary transaction account guarantee program that will fully insure certain deposits for a specified period, not exceeding 180 days. This program will be activated if the Secretary of the Treasury determines, based on recommendations from relevant agencies, that not implementing the program would harm financial stability. The program is designed to provide immediate support during economic crises by ensuring businesses' access to funds in their transaction accounts.
Implementation and Oversight
The Federal Deposit Insurance Corporation (FDIC) and the National Credit Union Administration (NCUA) will be responsible for the program's setup and monitoring, including data collection and analysis to determine eligibility and insurance amounts. There are provisions for periodic reports and testimonies before Congress regarding the program's status and effectiveness.
Financial Stability Considerations
To enter into the temporary transaction account guarantee program, banks and credit unions must not be insolvent, ensuring that the support only helps viable institutions. Additionally, there are measures in place for extending the program if necessary, contingent upon further analyses justifying its continuation.
Data Collection and Analysis
The bill mandates the collection of data from participating institutions to monitor the program's effectiveness and to assess its impact on financial stability. The first reports on the program need to be made public within 18 months after the enactment of the law, including detailed analyses and aggregated data.
Funding Mechanisms
Funding for the temporary guarantee program may come from assessments on participating banks and credit unions or from the existing Deposit Insurance Fund, allowing flexibility in how the program is financed during its operation.
Relevant Companies
- JPM - JPMorgan Chase & Co.: As a major U.S. bank, the changes in deposit insurance limits and the establishment of a transaction guarantee program may impact its operations and risk management strategies.
- BAC - Bank of America Corporation: Similar to JPMorgan, Bank of America may need to adjust its offerings and risk assessments to align with the new insurance coverages and funding mechanisms.
- USB - U.S. Bancorp: The bill could affect U.S. Bancorp's small business banking strategies and risk assessments due to new insurance parameters.
This is an AI-generated summary of the bill text. There may be mistakes.
Sponsors
1 sponsor
Actions
2 actions
| Date | Action |
|---|---|
| Jul. 21, 2025 | Introduced in House |
| Jul. 21, 2025 | Referred to the Committee on Financial Services, and in addition to the Committee on Rules, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned. |
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