Friday, April 3rd, 2020 – South Carolina’s banks are preparing to help distribute $349 billion in emergency Small Business Administration (SBA) loans to small businesses through the Paycheck Protection Program (PPP), part of the CARES Act passed by Congress last week.
“Our bankers have worked countless hours trying to decipher the guidance around the PPP loans. We joined many others in telling the administration the real challenges with the program and they listened. While there are plenty of steps to take to get procedures in place, bankers will continue working around the clock so this money can get in the hands of our deserving small businesses as soon as possible,” South Carolina Bankers Association president and CEO Fred Green said.
On Thursday, the SBA provided some clarity to banks through an Interim Final Rule regarding the Paycheck Protection Program. The rule is effective immediately and lenders can rely on it as they begin accepting and processing applications. The rule provided answers to critical questions, including specific underwriting guidance, instructions for important borrower certifications, clarity on lender liability protections, and a streamlined process to automatically qualify all banks that are in good financial condition to be authorized SBA lenders.
“It will take a little time for processes to be put in place to make the loan program work. For example, all loan applications need to be processed directly through the SBA portal, which is not yet prepared to handle the huge increase in volume. We ask all customers to be patient until the bandwidth can be increased and understand that getting this program ready and the money in the hands of the small businesses is a top priority,” Green said. “Our banks in South Carolina have provided significant borrower assistance since the public health crisis began, such as restructuring loans, helping with cash flow and extending additional lines of credit, and they will continue to do so during this crisis.”
Small business customers interested in applying for the loans are encouraged to reach out to their bank and get key payroll and expense documentation ready.
Details for borrowers, including a sample loan application form, are available from the Small Business Administration website here: Paycheck Protection Program (PPP).
The South Carolina Bankers Association is the professional trade association organized to effectively represent the common interest and welfare of the banking industry in South Carolina and to promote the professional development of its members and their employees. The South Carolina Bankers Association’s mission is to serve as a reliable and responsible source of information and education about areas of importance to the industry, and to be the key advocate in helping our member institutions in legislative, regulatory, educational and value-added services. You can learn more at www.scbankers.org