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Federal funding for the Paycheck Protection Program is drying up, but North Carolina bankers will continue to provide loans to small businesses.
“North Carolina banks stood by their small business customers well before the Paycheck Protection Program was created by the CARES Act, and will continue to stand by them now as that funding nears depletion,” said NCBA President and CEO Peter Gwaltney. “Banks will continue to work closely with small businesses to tailor financial solutions for their individual situations.”
As of Thursday, the Small Business Administration reported that more than 1.6 million applications had been approved totaling more than $338 billion in payroll loans.
While the initial funding of $349 billion for the Paycheck Protection Program was an unprecedented amount for such an initiative, Congress knew that more funding would be needed. Congressional leaders have publicly voiced their commitment to appropriate more funding and have closely watched the rate of program lending by banks to small businesses.
In just 10 days after the Paycheck Protection Program was launched, North Carolina banks made 23,786 program loans to North Carolina small businesses, totaling more than $5.7 billion. Once funding is depleted, the SBA said it will cease accepting applications from banks to make program loans.
The banking industry has been united in its appeal to Congress to approve more funding quickly so lenders can get back to work processing and funding payroll loans for small businesses in their communities. Small business owners can call their member of Congress at 202-224-3121 to express support for additional Paycheck Protection Program funding.
With the program’s April 3 launch, state bankers worked through that weekend and around the clock to process loans for small businesses.
“Bankers are working as fast as humanly possible to meet the overwhelming demand for Paycheck Protection Program loans,” Gwaltney said previously. “North Carolina banks have committed significant resources to originate these loans for small businesses in the communities that they serve. Our member banks are proud to play a role in the administration of this important economic relief program.”
The $349 billion congressional appropriation for the program was expected to run out. Senate Majority Leader Mitch McConnell announced April 7 that he’s working with Senate Minority Leader Chuck Schumer on additional Paycheck Protection Program funding. According to Senate Small Business Committee Chairman Marco Rubio, an additional $200 billion to $250 billion in funding is needed.
North Carolina banks have already implemented loan payment deferrals, loan modifications, fee waivers and many other measures to help their customers through these difficult times.
“North Carolina banks entered this pandemic from a position of strength, thanks to record capital and liquidity levels, as well as prudent planning and risk mitigation,” Gwaltney said. “We look forward to helping small businesses across North Carolina get back to work.”