Small business owners who were not Johnny-on-the-Spot to apply for the Paycheck Protection Program loans, which are guaranteed by the federal government, may have to wait a bit longer.
Toward the end of last week, two Alaska banks stopped taking applications for what is called a “PPP loan” for small businesses, self-employed, nonprofits, and independent contractors who have lost their incomes due to the COVID-19 economic shutdown.
First National Bank of Alaska, Northrim Bank suspended their acceptance of applications, while AlaskaUSA Federal Credit Union is limiting the program to credit union members only.
Wells Fargo and Key Bank appear to still be accepting applications online, since all banks have closed their lobbies to the general public. Credit Union 1 is not participating in the PPP program.
The PPP is open with the SBA until June 30, 2020. Funded by a bill passed by Congress, the PPP gives small businesses, nonprofits, and “gig economy” workers access to short-term cash flow assistance to cover operating expenses and keep their employees. The loans will come directly from the banks, with interest as low as 1 percent, and no payment for six months.
One business owner who applied last week told Must Read Alaska the process involves a lot of paperwork and documentation.
“It’s not an easy loan to get, takes a lot of work. My application is two inches thick. My bank manager told me they were pausing applications. I think mine was one of the last in the door,” she said.