Beaufort Co., SC businesses in line for $500 million when loan program replenished
A mad scramble to apply for the Paycheck Protection Program before funds ran out left many South Carolina small business applications frozen in place.
A thaw may be on the way.
Once new funding arrives, at least $500 million in loans will flow to those business owners who applied and are on stand-by, according to Fred Green, president and CEO of the S.C. Bankers Association.
Green polled 42 banks that are headquartered in South Carolina and participated in the PPP. He said they told him that at least 4,000 applications were backlogged after funding dried up April 16.
Those small business owners “will be first in line,” Green said, as Congress and the White House are poised to pass and sign a bill including an additional $320 billion to replenish PPP. Initially, over $3.8 billion from nearly 23,000 approved PPP loans went out to South Carolina businesses before funding ran out, according to the SBA.
The number of backlogged applications that are ready-to-go is likely higher since bigger banks like Wells Fargo and Bank of America said they, too, are waiting on the Small Business Administration to begin approving loans again.
Green estimates the total backlog in South Carolina, including small business applications made to out-of-state banks, is from 8,000 to 10,000.
If all goes according to plan, banks could begin moving the chains on applications as early as Friday or Monday, according to William Furman, S.C. senior area manager for the SBA.
The SBA’s loan program was centered around federally-backed loans offered through private lenders that would allow small businesses to keep the lights on and their employees paid. Businesses are required to spend 75 percent of the loan on payroll and 25 percent on payments such as rent or mortgages.
The program’s rollout was rocky and left some SC small businesses out of the first wave of funding.
“We came out of the gate stumbling a little bit, both the SBA and lenders,” said Furman on a Hilton Head-Bluffton Chamber of Commerce call Wednesday morning.
He said the learning curve is behind the agency now and that the SBA will be ready once the new federal money is approved.
The Senate approved a bill Tuesday which provides additional money for the lapsed PPP.
Of the new funding for the program, $60 billion would be reserved for lending by small and medium-sized financial institutions.
