When businesses desperate for funds from the Paycheck Protection Program were caught in application bottlenecks from big banks or had applications declined without knowing why community banks and credit unions stepped up. These financial institutions championed borrowers, often spending long hours working directly with applicants, ensuring that requests were approved.

In March of 2020, the Covid-19 pandemic caught many people off-guard. One week it was business as usual, the next, statewide shutdowns and closures. Many community banks quickly formulated plans to keep their employees and customers safe. Technology once considered nice-to-have -- online applications and account openings, e-signatures -- was now essential. 

Going to the hospital is a stressful experience. Whether it is due to an injury or major illness, an in-patient stay is flooded with medical jargon, major decisions, and after-care instructions. On top of that, many patients worry about how they will pay the subsequent bills.

Though financial institutions were already headed in this direction, the pandemic massively accelerated the industry’s use of technology! Now, even as the lobbies of banks and credit unions are opening, the demand for digital offerings is not subsiding.

Historically low interest rates have sent borrowers racing to take advantage of the savings. Consumer mortgage departments, in particular, have been swamped with purchases and refinances -- with home loan rates dipping below 3% at times. Yet on the other side, such low rates have likely given more than one bank director heartburn as they look ahead toward overall bank performance for the year. However, community banks still have opportunities to maintain profitability, even when they are not earning as much on the money they are lending.

Digital lending used to be a “nice to have” feature in the community banking world; now it is considered table stakes. While digital transformation was already underway with online applications, mobile banking apps, and more, the use of digital solutions skyrocketed during the COVID-19 pandemic. 

As the words “return to normal” and “post-COVID” enter our vocabulary, they reveal the real-world after-effects of the pandemic. Experts expect the ensuing impact of the coronavirus to affect everything from major industries to transportation, to society’s approach to work and education.

Over the past several months, your team may have been thrown into unchartered territory, rapidly learning to navigate telehealth, payment delays, and coronavirus claims as well as payor changes and inconsistencies.

Waiting to see what Congress does about PPP loan forgiveness is a risky choice for financial institutions. Large banks and credit unions are already communicating with their borrowers about how to prepare for loan forgiveness and are going to start processing applications in a couple of weeks.  Borrowers are getting impatient -- and there will be tax implications for carrying loans into 2021. The SBA is ready, your borrowers are ready, we have a portal to streamline the whole process for you. Let’s get started. 

Great job! You’ve helped your members and borrowers access the capital they need to stay solvent through the last several months.