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Trevor Noah, host of The Daily Show, recently did a segment on the SBA’s Paycheck Protection Program (PPP). During it, he opined that some “not so small businesses” obtained loans and shouldn’t have. He is not wrong. Companies like the LA Lakers—valued at $4B—should not have received the $4.6M loan they did, which they have since returned. He goes on to report, among other things, lawsuits are already being brought against Bank of America, Chase, US Bank, and Wells Fargo for allegedly prioritizing their bigger customers over their smaller ones.
To be sure, execution for the two channels of funding for the PPP was less than ideal. During the first round of funding, the SBA, as well as the lenders providing the loans, were “building the plane as we were flying it.” Adding further pressure, the announcement of the CARES Act’s passage made it appear as if the loans would be made immediately available. Of course, they weren’t.
In the second round of funding, the SBA’s system was overwhelmed by the number of applications coming in. This was due in part to the ever-increasing need of small businesses. But more so, larger lenders used technology to attempt to robo-submit at the same time the thousands of loans they previously had queued up.
Sounds pretty dire, doesn’t it? Fortunately, that is only part of the story.
Through our advocacy, particularly with Senator Collins, but also with Senator King, Congresswoman Pingree, and Congressman Golden, robo-submissions were disallowed and small lenders, including credit unions, got a window of time dedicated solely for them.
The other part of the story, not fully being told yet, is about the small businesses you helped, whether through the PPP and/or your own offerings. What I have heard about from you are loans ranging in size from $2K to $2M+ for small businesses all over Maine, forbearance to ease terms, and skip-a-pays. The types of businesses served run the gamut from auto repair and furnace repair to daycare to marine products to restaurants and more. They represent the heart of Maine and what makes us tick.
This side of the story needs to be told. It provides perspective. It provides hope. Most importantly, it provides information to small businesses that help is available to them.
Starting next week, we are going to launch a request for you to help us tell this story. We will ask you for examples of small business and individual members you have helped. We’ll also ask for examples of where you may have provided support to your communities. Finally, we will ask whether you provide business lending, especially for small businesses. This will help us determine where the next set of needs are going to be.
Stay tuned for more details and thank you for all you are doing to serve your members and communities.
Your examples will help us paint a picture and provide us valuable input that we will share with our elected officials to help them determine if further actions are needed.