Peoples Bank announced that it had funded 92 applications for the Paycheck Protection Program fund approved by Congress in early April to help small businesses impacted by COVID-19.
Those 92 applications totaled $12.4 million going back into the hands of local business owners. The average loan size was $135,023. Peoples Bank personal lenders worked long hours to ensure its deposit and loan customer had access to the funds.
“Our small business customers represent the lifeblood of our local economies, so we have to do everything we can to support them right now,” said Peoples Bank President/CEO Kevin Halterman. “These funds will not cover all of their expenses and responsibilities, but everything helps.
“Our job is to be the source of calm during this chaotic time,” Halterman said.
Overall, Iowa small businesses claimed $3.75 billion of the $349 billion approved by Congress. The Iowa Bankers Association reported those claims saved 325,000 jobs.
Leaders fear it’s not enough and are encouraging Congress to convene and approve more. That effort is currently stalled. The need remains, Halterman said, and Peoples Bank will continue to take applications from its customers in anticipation of additional funding.
The program helped small businesses, non-profits, and the self-employed.
The loan will be fully forgiven if the funds are used for payroll costs, interest on mortgages, rent, and utilities (due to likely high subscription, at least 75% of the forgiven amount must have been used for payroll). Loan payments will also be deferred for six months. No collateral or personal guarantees are required. Neither the government nor lenders will charge small businesses any fees.
Forgiveness is based on the employer maintaining or quickly rehiring employees and maintaining salary levels. Forgiveness will be reduced if full-time headcount declines, or if salaries and wages decrease.
This loan has a maturity of 2 years and an interest rate of 1%.