Courtesy/U.S. Small Business Administration
Amy Bassett, district director of the SBA's Maine District Office.
April 27, 2020
After financing frenzy, Maine lenders launch second round of small-biz bailout loans
Photo / Renee Cordes
During the statewide stay-at-home order, small retail establishments like Rosemont Market & Bakery in South Portland are offering curbside and pick-up service only.
Maine banks and credit unions are gearing up for a busy week processing small-business loan applications, all seeking a share of $320 billion in the second round of the federal Paycheck Protection Program that kicked off this morning.
The U.S. Small Business Administration bailout program for employers hurt by the ongoing COVID-19 crisis was extended last week after its $349 billion initial budget was quickly exhausted.
Amy Bassett, district director of the SBA's Maine District Office, told Mainebiz the agency doesn't anticipate any significant changes to the application process this time around.
But "we do expect that the process will be smoother for the lenders and the applicants, as many are now well-versed," with reports of many queuing up applications since the first round was used up.
During the initial funding, which ended April 16, nearly 15,000 applications in Maine were approved for almost $2 billion through nearly 150 lending institutions, according to the SBA.
The average PPP loan was $133,333, which Bassett said will help the businesses survive and meet their upcoming eight weeks of payroll cost.
'Game for more'
After a short breather over the weekend, Kennebec Savings President and CEO Andrew Silsby said his team is "game for more" after processing more than 400 loans for $52 million in the first round, which he said will save more than 6,000 local jobs.
"To hear the relief in a small business owner’s voice or see it on their face, makes all the hard work worth it," he told Mainebiz. "Our small business community is really hurting right now, and so this is a great program that is making a big difference out there."
For the 70 small businesses that did not get a payout before the initial funding ran out, "we have worked really hard over the past week to have all those applicants all ready to go, so that we can immediately submit them to SBA once funding opens up again on Monday morning."
Silsby also said he worries about the SBA’s computer systems being able to hold up under what he anticipates will be an extreme amount of demand in the first few days of this week.
For businesses interested in applying, he recommends reading new clear federal guidance for verifying payroll amounts by business types here.
Camden National Bank will also be processing loan applications for round two, said Greg Dufour, president and CEO.
"In many ways, the PPP is a historic program, both in terms of the size of relief and speed of the program," he told Mainebiz. "Early estimates are that round two funds will be also be committed very quickly. The biggest lesson from round one is having a complete and accurate application from the borrower is critical to ensure their application is processed as quickly as possible and funds are approved."
Patricia Weigel, president and CEO of Norway Savings Bank, said her team has been gearing to process more applications this week after processing an "astronomical loan volume" of 1,000 PPP loans totaling $100 million in just 10 days.
"There are still many businesses and non-profits who need our help and were unable to complete their applications for round one." she said, giving a shout-out to Norway Savings Bank's talented software analysts were able to build an automated application system in the 24 hours just before the first round opened.
"The best part, however, is that the work has been tremendously gratifying for our team," she said. "Each loan they process and approve represents an opportunity for more Maine employees to receive a paycheck."
But she also predicts that the funds this time around will be more quickly depleted than in round one.
Borrowers should 'act fast'
SBA Maine District Office Director Bassett advises would-be applicants to submit their completed applications and supporting documentation to their lending institutions and as soon as possible, and look up the latest information here.
Todd Mason, president and CEO of the Maine Credit Union, has similar advice, saying that "interested borrowers must act fast."
“Small businesses should start with their credit union or bank to determine if it is providing PPP loans," he suggests.
"The good news is many more are now able to offer them than at the start of the first round of funding. Next, begin the application process right away. The demand for these loans is high, and funding could run out in a matter of days. Fortunately, there is much better information available than at the beginning of the program for borrowers and lenders on SBA’s website. Financial institutions are better positioned to navigate applicants through the loan process quickly and are ready to help."
Mainebiz webinar replays
Mainebiz recently held two free webinars for businesspeople seeking information about the federal funding. Each hour-long discussion featured a panel of experts who presented practical information and responded to audience questions.
Replays of the webinars are available by clicking these links.
Mainebiz Webcast 1: Paycheck Protection Program
Mainebiz Webcast 2: The Economic Injury Disaster Loan Program and other grants, loans and credits
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