Bank Independent recently provided businesses with guidelines on the Small Business Administration’s Paycheck Protection Program loan forgiveness process.
The PPP loan program is intended to help small businesses with their payrolls to keep workers employed during the Covid-19 crisis. Thousands of small businesses in Alabama successfully applied for the program, and if they meet the terms set by the SBA and the U.S. Department of Treasury, those loans will be forgiven.
“Bank Independent was instrumental in processing over 1,500 successful SBA PPP loans over the last few weeks,” said Macke Mauldin, Bank Independent president and CEO. “Loan approval was just the first milestone for these small businesses. Meeting and understanding the terms of the forgiveness process would be the next.”
The bank shared with its clients through a webinar the guidelines SBA has to forgive the loans. The small business must maintain and continue to pay all employees on the payroll for eight weeks and the loaned funds should be used specifically for the purpose of payroll, rent, mortgage interest or utilities. The loan forgiveness timeline covers a period of 8 weeks, or 56 days, from the first day a business received the funds. Then businesses must complete the PPP loan forgiveness application and submit to their lender to begin the forgiveness process.
To expedite the process, Bank Independent has partnered with technology vendor Abrigo to manage the SBA PPP process. The forgiveness guidance from the SBA, initially issued on May 15 with additional guidance issued on May 22, is quite lengthy.
“My best advice is to be consistent with the information you used in your initial PPP application,” said Paula King, a CPA and senior advisor at Abrigo. “Although no expiring timeframe has been provided, businesses can apply as soon as the 8-week period is up. Use this time to ensure all the required information is available when you apply.”
Businesses that do not qualify for all or a portion of forgiveness will still benefit from the terms of the PPP loan, which has an interest rate of 1 percent and a maturity date of 2 years.
“The mission of Bank Independent is to make a positive difference in the lives of our customers. We worked really hard to do that with this program,” said Mauldin, who added that the bank had approved and funded PPP loans totaling more than $110 million.
Bank Independent has 28 sales offices across North Alabama and one digital sales office. Headquartered in Sheffield, Bank Independent is the sixth largest bank in Alabama based on total assets in 2019.
Click here to view the forgiveness guidelines webinar.
