When the coronavirus (COVID-19) hit the US market, the majority of the businesses had to shut down due to lockdown orders. Due to the lockdown, Congress established the PPP (Paycheck Protection Program) to provide relief for small businesses as part of the CARES Act. The first round of PPP funding was completely depleted in less than two weeks, then congress approved another $310 billion for PPP.
It is important to notice that many small businesses that are able to receive the loan are usually an existing client to the banks who are offering PPP. These businesses were on a higher priority because they already have an existing relationship with their banker hence their loan applications were accepted timely.
Why is it important to have strong ties with you bankers? Having sound banking relationships are important for business owners especially in times of need. Example, when these business owners applied for the PPP loan, they received timely assistance from their bankers that they have maintained a working relationship with, making it easier for them to obtain the funding they need.
What should you look for while selecting a bank to work with? Below 2 important factors to consider:
Accessibility to your banker
– In times of trouble, is your banker able to pick up the phone to assist you?
Support for your business growth
– Does your banker understand your business? Is he or she able to help you grow your business on a continuous basis?
Expertise of the financial institution you bank with
– Does your bank provide assistance to small business owners or to your industry in particular? If you are looking to apply for an SBA loan, is your financial institution an SBA-preferred bank?
Is your banker an influencer and a resource to your business?
-Is your banker well connected to the extent that they have the right connections or resources who could help you bring your business to the next level?
Don’t have a banker or need help with PPP loan? Reach out to us today!
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