MADISON, Wis. (WMTV) -- The Wisconsin Bankers Association (WBA) is asking small business owners to stay patient as the Paycheck Protection Program (PPP) launches on Friday.
Officials said the program will offer some relief to small businesses, but the application volume will be very high as the fewer than 170 financial institutions qualified to offer these loans will work to keep up with demand.
WBA said sheer volume won't be the only reason the program will take time. Financial institutions still need guidance from federal agencies and regulators in order to move forward with PPP loans.
The Wisconsin Bankers Association has created an online resource for small businesses and consumers located at www.wisbank.com/COVID-19.
“Keep in mind that PPP loans aren’t the only way Wisconsin’s banks are helping their customers,” said WBA President and CEO Rose Oswald Poels said. “They worked one-on-one with their customers to find solutions before PPP became available and they will continue to do so after the program is done.”
WBA also recommends the following five things businesses can do right now:
1. Talk to your lender, if you haven’t already
If you are experiencing or expect to experience cash flow problems, contacting your lender is the critical first step.
2. Plan for the next 3-6 months, if you haven’t already
Many businesses we’ve heard from have sufficient funds or access to capital for the first 2-3 months. However, we don’t know how long the pandemic will last, so look ahead, both in terms of a potential lengthening of the pandemic and also in how you will handle recovery and re-opening of the business if you are currently closed.
3. Be ready to produce required information quickly to help your lender with your application
All loan programs still require some information in order for the lender to underwrite the loan, including the ones created through the CARES Act. Be ready to produce required documentation quickly to help your lender with your application.
4. Don’t panic and draw on lines of credit unnecessarily
There is plenty of liquidity in the system (unlike the financial crisis in 2008) so don’t panic and draw on lines of credit unnecessarily. Just like we are encouraging consumers to keep excess cash in insured financial institutions, keep the lines of credit intact until you absolutely need to access them. There may be costs associated with accessing those funds and if you don’t need to incur the added expense, don’t.
5. Have patience
The banking industry wants to help you through these unprecedented times, but not all programs are in place yet, and even when they are, technology can cause hiccups or delays (e.g. systems crashing).