It seems like every small business owner in America contacted their bank to apply for the Payroll Protection Program on Friday. Almost all were left frustrated and still in financial limbo. CLICK HERE to watch a video on this topic.

Here a couple examples of the confusion and volatility going on now:

One of our clients, a small business owner in the Bay area was notified on Friday that the $379,000 Disaster loan she was approved for on Thursday, was just capped at $15,000 – a $364,000 swing. The relief she was counting on just “changed,” and without warning.

Over the weekend, I was in an email chain with leaders in the franchise community representing hundreds of thousands of small businesses from a multitude of industries. Very smart and skilled professionals – and even they were confused on the technicalities of the Payroll Protection Program trying to make sense out of what makes no sense with payroll calculations. WHY IS IT SO HARD TO DEVELOP A UNIVERSAL CALCULATION OF THE AMOUNT A BUSINESS CAN BORROW? This is vexing even the smartest financial minds.

The Payroll Protection Program through the CARES Act has been touted as a lifeline for small businesses who have been forced to close or drastically reduce their business due to the Coronavirus. However, information regarding the program is ever changing, inconsistent and downright confusing.

Frequently changing guidance from the Treasury Department, including an “interim final” update published only hours before the deadline that banks were given to begin accepting loans, left many lenders unsure of how to proceed.

The Payroll Protection Program was rushed through the implementation process and was pushed live before banks had the ability to create stable processes for accepting and funding these loan applications. The SBA, Treasury Department and the Federal Reserve were tasked with completing the process that normally takes months to implement in just 7 days, and now banks are expected to execute it.

Major banks, including Wells Fargo and Chase, publicly said on Friday that they weren’t yet ready to accept loan applications. A top exec from Bank of America said “It’s like building an airplane while you’re flying it.”

Lenders have stated that the SBA and Treasury Department have failed to provide them with the necessary guidelines, set unrealistic deadlines and set requirements for the loans that are unworkable. The effective lack of regulations and detailed guidelines (including the extent lenders might be held liable for loans) has many scratching their heads.

As we navigate this confusion at the same time as the banks, here’s a few tips for PPP:

1. Your ability to get to the front of the line likely depends in part on having a good relationship with your lender. Of course, try that approach first.

2. Apply for your paycheck protection loan through multiple banks, in the hope that one of them might be able to process your application first.

3. Don’t assume that because you’ve applied, your application will be processed or funded. A number of online financial firms, for example, are collecting applications. But many haven’t yet been approved to make paycheck protection loans themselves.  In the meantime, many companies are packaging up applications hoping to sell them to banks in bulk.

4. Beware of loan scams, especially from people who say they can get you a loan faster for a fee. You shouldn’t have to pay a cent to submit a paycheck protection loan application.

5. Remember – the “rules” can change, as we’ve seen before.

Watch for my next article on Tips for Financial Stability and subscribe to the Qnity YouTube channel HERE for financial updates and education for small businesses.

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