A Firsthand Account of a Paycheck Protection Program Loan Application

Like millions of other businesses here at LendIt Fintech we have been impacted dramatically by the coronavirus. We have had to postpone our flagship USA event by almost five months and we have switched to offering digital content. So, while I have been covering the Paycheck Protection Program (PPP) for the industry, I have also been paying close attention to how our own company should navigate this new program.

We have a business banking relationship with a top 10 bank that goes back to our founding back in 2013. When the PPP launched on April 3 they were dragging their feet and provided no guidance that day at all. Also, we were not confident they could handle the massive rush from their many small business customers.

I would have liked to have applied with a fintech lender but when I spoke to several of them right as the PPP was about to launch none were confident they could issue PPP loans in a timely manner. And it was only the middle of last week that fintech lenders could even apply to become part of this program. So, we looked at other options.

Our Denver attorney mentioned that he was getting his PPP loan through a small, local community bank. I connected with a banker there on April 4 (a Saturday), the day after the PPP went live, and by Sunday we had submitted our PPP loan application. They had some follow-up questions on our application that we promptly responded to and by Thursday we had been approved by the bank.

But the most important step comes next, where the bank has to input our data into the SBA E-Tran system. This has been a bottleneck for many banks due to the number of loans trying to get into that system. One fintech leader told me that the volume at E-Tran is somewhere close to 100,000 times their normal volume so there have understandably been some hiccups.

We were informed by our banker that we were in line at E-Trans on Friday morning and by Friday afternoon we were approved with an SBA loan number. That was four days ago and while we have not yet received our money our banker said it should be in our account by the end of the week. Now, we have opened a new business account with this community bank so the money will be deposited there. Hence their motivation to serve new customers like us.

[Update 4/20/20: we received our PPP loan money ten days after being approved.]

Our regular big bank has still been dragging its feet and in fact we have received three emails from them over the last week urging us to apply elsewhere for a PPP loan. So, we are happy we took the initiative here and went with a local community bank. As I said, I would have liked to have applied for this loan through a fintech lender but we couldn’t risk waiting for one of them to be approved.

With Congress still squabbling about how to increase the amount of funding to the PPP and concerns that the initial $349 billion will run out as soon as this week it has been important to move quickly.

Now, none of us know what the future holds but, like millions of other small businesses, this money will help us weather the next few months until the economy can be safely reopened, and we can return to a new normal.

  • Peter Renton

    Peter Renton is the chairman and co-founder of Fintech Nexus, the world’s largest digital media company focused on fintech. Peter has been writing about fintech since 2010 and he is the author and creator of the Fintech One-on-One Podcast, the first and longest-running fintech interview series.