How the Paycheck Protection Program showed the True Worth of Community Banks.

It took a vicious virus and the Paycheck Protection Program (PPP) to show the American people the true worth of Community Banks. Yes, the Bank of Americas of the world do have more technology, more branches, more marketing muscle, more ATMs, and more employees. But, the Community Banks seemed to have a passion for taking care of their customers and their local community that, frankly, seemed a bit lacking on the big bank front.

I know many, if not most, of these community bankers worked all during Easter weekend to help their local businesses apply for what turned out to be, of course, extremely limited (and competitively-sought-after) PPP funding. They worked from home, many hours day and night, to protect their customers and their community. Their efforts paid off. Rob Nichols, CEO of the American Bankers Association, reported a couple of weeks ago that 60 percent of the PPP loans made to date have been made by community banks throughout the country.

I know someone who has been a customer of Bank of American for 35 years. They were not so fortunate.

On April 3rd, at 8:00 am, on the opening day for PPP applications, they called and emailed their “BOA, Small Business Banker” asking about how they should apply for the PPP.  A couple of hours later they received an email saying “Please go to to apply, the site is live.”

When they went to the site, it said they had to have a “pre-existing business lending and business deposit relationship with BOA”.

Fortunately, or in this case unfortunately, they have no debt. And by this time, their BOA Small Business Banker’s voice mail was full and she wasn’t returning emails. 

On Monday, April 6th, after a national outcry from angry customers, Bank of America had reversed its ridiculous decision and would allow businesses to apply if they had a “Small Business checking account opened no later than February 15, 2020, and do not have a business credit or borrowing relationship with another bank.” Within minutes they applied and received an email stating “Your application has been submitted”. 

On Thursday, April 8th, they received a phone call from an individual stating that they were with Bank of America and wanted to confirm that they had uploaded their documents for the PPP.  The BOA representative wasn’t even able to access the files and had no idea what had been uploaded.

A week later, on April 15th, they received an email from BOA stating, “We need additional information to process your Paycheck Protection Program Application. After logging in you'll be prompted to update your business information.”

Guess what? There was no prompt and no help button. And obviously no one to speak with. In multiple places on their emails and website they state: “Any communication about the process and your loan will occur through your IntraLinks workspace OR via a call from our underwriting centers. Bank representatives are unable to discuss eligibility with Applicants or assist Applicants in competing the application materials.”

After hearing about how many community bankers worked over Easter weekend and how many PPP loans the community banks were making, they contacted a local community bank, Signature Bank in Sandy Springs, GA. They spoke with a real person and were told exactly what they needed to do.  In less than 24 hours they received an email from Signature Bank that their PPP loan request had been approved!

They have yet to hear from Bank of America and don’t even expect to.

I don’t think BOA ever intended to make PPP loans to customers that didn’t have loans with them. They just changed their website to make it look that way. It became obvious that BOA was not in business to help the local small businesses. And that’s not just my opinion. It’s also the opinion expressed by the Wall Street Journal in their April 6 article, “Big Banks Favor Certain Customers in $350 Billion Small-Business Loan Program”.  According to The Journal, many applications were denied because the applicant “hadn’t borrowed from BOA in the past.”

To be fair to BOA, they were not the only big bank that found themselves tripping over their own feet over the last couple of months. In an Alignable article by Eric Groves entitled, “JP Morgan Chase turns it’s back on Small Business Clients,” Groves points out that “Chase decided to serve the needs of larger clients while ignoring small business owners when they needed this financial powerhouse the most. Clients were told they should not open up applications with other financial institutions if they were going to submit with Chase. The bank then processed only 27,307 loan applications to reach a whopping total of $14 billion in CARES Act Relief. Their average loan size was over $500,0000, generating over $200,000,000 in processing fees for themselves.”

Our company,, works with over 250 community banks and I am so proud of all of them. They have shown their true worth during this economic crisis. Cheers! The secret now is for these community banks is to make sure they supply these small businesses with all the products and services offered by the larger banks, including remote deposit capture, mobile banking, and payroll services. They also need to continue to do a good job of messaging; letting their customers know that they appreciate them, and that they are there for them with the assistance they need right now, from loans to investment products.

As the saying goes, sometimes you have to get sick in order to feel better. What this crisis has shown, through a sickness in both health and wealth, is that community banks, and community bankers, really care.  Congratulations on a job well done!

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