When the Small Business Administration rolled out its Paycheck Protection Program, it set off a fire drill of sorts among bank technology executives, who had to quickly figure out how to accept applications from borrowers and load them into the SBA's system before the money ran out. Like other banks, the $1.4 billion-asset Sunrise Banks in St. Paul, Minn., had two weeks to decide whether to buy or build a solution, set it up, test it and take it live. As of June 5, Sunrise had made $216 million in paycheck protection loans. What follows is a look at how and why the bank made the technology choices it made and how it plans to use this technology for other purposes when the program ends.
Each year LEDC selects a lender that has shown stellar performance in participating in the Louisiana Small Business Loan Guaranty Program. The Bank of the year recipient exemplifies one of the tenants of LEDC's mission by "Cultivating jobs and economic opportunity through small business, innovation and entrepreneurship." This year's recipient, Bank of St. Francisville, provided access to more than $1.5 million in capital to native small businesses through the Louisiana's small business loan guaranty program.
When does a country reach a tipping point—a point when the citizenry concludes that things are simply spinning out of control, and that something different is required? The question arises, obviously, as protests and looting spread across America in the wake of the brutal police killing of a black man—shocking scenes that have come atop a once-in-a-century pandemic and a Depression-like economic slide. In a moment of crisis, it’s hard to tell when such events will simply fade away in a return to the status quo, and when they will produce lasting change in political and social structures. Yet a look back at recent history suggests that it is precisely at moments like this, when shocks pile on in succession from different directions, that Americans can choose a new course.
Zach Luke of Greenwood's Bank of Commerce has been elected to serve as president of Mississippi Young Bankers, a section of the Mississippi Bankers Association. Mississippi Young Bankers provides leadership development activities and supports financial literacy programs of the MBA and its member banks. Young Bankers members are involved in administering scholarship programs for high school and college students, supporting the MBA Education Foundation and advocating policy positions important to the banking industry. Luke serves as chief financial officer of the Bank of Commerce, where he has been for more than nine years.
Radical change is possible in the banking sector. It's already happened, actually. Over the past 30 years, the U.S. banking sector went from one dominated by small, community banks to one dominated by massive, global banks. Public policy was a major driver of that shift. Some have spent the last decade or longer searching for ways to restore some community-mindedness to the banking sector. We can’t possibly list them all, but here are some of the ones we’ll be watching closely as the COVID-19 pandemic drags out into an economic recession and eventual recovery. Native American Bank is mentioned.
Applications officially opened on April 3 for the new Paycheck Protection Program loans guaranteed by the Small Business Administration. The program is intended to help small businesses keep or rehire employees to get through at least part of the economic disruption from COVID-19. All or most of each loan can be forgiven, based on whether borrowers maintain employee levels they had before the economic disruption from the virus took hold. Serving small cities and towns and rural parts of Arkansas and the Mississippi Delta, Southern Bancorp was already approving and wiring Paycheck Protection Program loans to borrowers back on April 3. Sunrise Banks and Beneficial State Bank are also mentioned in the article.
An emergency loan program intended to get money swiftly into the hands of small businesses has all but collapsed under an unprecedented crush of applications and a shortage of funds, overwhelming agency officials and prompting urgent calls for action on Capitol Hill. The Economic Injury Disaster Loan program, or EIDL, a long-standing program run by the Small Business Administration (SBA), is separate from the $349 billion Paycheck Protection Program for small businesses that is the subject of a political fight on Capitol Hill. The federal government normally doles out EIDL loans to small businesses hurt by tornadoes and wildfires. On March 12, the SBA expanded the program to help entrepreneurs hurt by the coronavirus, offering low-interest loans of up to $2 million.
Community Development Financial Institutions, or CDFIs, are utilizing all resources at their disposal to help small businesses stay afloat as the novel coronavirus spreads throughout the U.S. CDFIs serve customers typically overlooked by mainstream financial institutions. Beneficial State Bank, an FDIC-insured CDFI that provides commercial banking services to underserved communities, had received 500 phone calls a day about PPP two days before the program even launched on April 3, Interim CEO Randell Leach said. CDBA members Bank Plus, Mission Valley, NOAH Bank, Peoples Bank, and Sunrise Banks are also mentioned in the article.
Applying for PPP loans is urgent; but how do you sift through 10,400 banks and credit unions for ones that are more likely than others to take and process your application? Relying mostly on publicly available data, Mighty's platform profiles all 5,200 banks in the country, highlighting each bank's connections — or the lack thereof — to specific causes, communities and underserved small businesses. Many of those businesses are currently scrambling to find a bank willing to take their application for one of the new Paycheck Protection Program loans. Mighty just started keeping a list of its bank partners who are accepting applications for the new Paycheck Protection Program forgivable loans. It’s not a very long list right now, but they expect it to grow. There’s also CapNexus, a platform run by the nonprofit Partners for the Common Good. It currently lists a curated set of 501 financial institutions, some of which are banks and credit unions, some of which are loan funds.
Minority business owners have always struggled to secure bank loans. Now, many banks want to deal only with existing customers when making loans through the government's $349 billion aid package. Anticipating that minority business owners could struggle to tap federal aid, some lawmakers are proposing ways to earmark additional funds specifically for minority-owned businesses. And on Wednesday, a group of prominent black investors, including John W. Rogers Jr., the billionaire co-chief executive of Ariel Investments, a mutual fund manager, sent a letter to lawmakers expressing concern that the emergency loan program was already leaving black borrowers behind.