Small businesses have suffered a great deal as a result of mandated closures and shelter-in-place orders nationwide. The first installment of government financial support was not entirely sufficient, resulting in the extension of the Paycheck Protection Act from July 6, 2020 to August 8, 2020. Community banks and credit unions have played a large role within the application and distribution process of these loans, many of which would not be done without a digital application. But what about those financial institutions who have no digital lending capabilities?
MeridianLink has created a Saas-based Fast Track digital software for SBA PPP loans that can be deployed within 48 hours and it enables banks, credit unions, and lending institutions to accept SBA PPP loan applications online.SBA PPP Lending Technology Enables Banks & Credit Unions Assist SMBs
Many businesses large and small within the United States temporarily shut their doors as states implemented shelter-in-place orders due to the COVID-19 pandemic. Small businesses were particularly struggling, as their profit margins are already so small. Due to this, the US Treasury has implemented the Paycheck Protection Program (PPP). According to the U.S Small Business Administration, the PPP is, “An SBA loan that helps businesses keep their workforce employed during the Coronavirus (COVID-19) crisis”. Although this program was only open for a certain amount of time, due to continued closures and immense strain on small businesses the Paycheck Protection Program has resumed as of July 6, 2020 and will be open until August 8, 2020, as a result of the President signing an extension.
According to Treasury Department data, over 1.1 million community banks and credit unions made up 18% of the programs lending. CreditUnions.com, powered by Callahan and Associates data resorts that just from credit unions alone more than 1.1 million jobs were saved through the Paycheck Protection Program.
The data that was released by the department was divided in two sections. Loans greater than $150,000, the department specified the borrower by name and other information but provided only ranges for the loan amount. Loans less than $150,000, the department did not identify borrowers by name but did provide the specific loan amount.
Early analysis done by Callahan and Associates illustrates that, “credit unions in all 50 states, the District of Columbia, and five territories originated 11,424 loans exceeding $150,000, accounting for 1.73% of all loans in this bucket. Because the specific dollar amount is not included for larger loans, the total balance for loans in this category is likely between $3.24 billion and $7.91 billion”.
As assets to their community, eager to help and build a better life for their members and customers, community banks and credit unions have once again proven their commitment. Application data shows that 1,144,035 jobs were saved as a result of these financial institutions being ready to assist every eligible business owner. Over 13% of applicants did not include the number of individuals they employ, so the number is thought to be larger.
Due to safety regulations such as social distancing orders and limited capacity, many community banks and credit unions heavily relied on SBA PPP technology to safely and efficiently meet the needs of their small business community. As an effort to help banks and credit unions who did not have digital lending capabilities MeridianLink launched a Saas-based Fast Track digital software for SBA PPP loans that can be deployed within 48 hours and it enables banks, credit unions, and lending institutions to accept SBA PPP loan applications online using a 3 simple steps. This technology enables financial institutions to accept digital loan applications from small businesses seeking SBA PPP relief.
As mentioned above we have pivoted our product offering to ensure that every community bank and credit union is able to assist small business owners within their community to safely apply for SBA PPP loans. We are currently working on enhancing these opportunities to further help financial institutions be an even larger aid. To learn more about our SBA PPP loan application technology and how your financial institution can implement this software, please click below.
