(Updated as of 4 p.m. on 4/3)
Many restaurants and small to mid-sized food companies are eagerly awaiting the start of the funding of the $349-billion Paycheck Protection Program (PPP) that is part of the CARES Act.
However, lenders and applicants have not been fully informed by the federal government with much of the information they need to apply.
“The response is overwhelming – it is unlike anything I have ever seen in my career” said Craig Street, the chief lending officer of United Midwest Savings Bank. (Source: New York Times Friday, April 2, 2020)
While food companies with under 500 employees are eligible to apply for the PPP loan, some may find themselves looking for lenders. Many of the largest banks said they planned to offer the loans, though some will restrict which application they will work with. Some banks said they will make the loans available only to customers that currently have existing lending and treasury relationships.
Today is the first day available for acceptances of the PPP loans, and the industry will see how the process goes. Many companies were able to complete their application and submit them to their banks. However, many banks are still working on their applications and website portals
before opening them up to their clients. Certain banks are only allowing applications from customers with a “pre-existing business lending and business deposit relationships.”
In the meantime, my advice is to prepare the best you can. This is a first-come, first-served process, so you will need to be ready when they do start taking applications. The Treasury has posted the final application, which you can use to help you prepare. But note that banks, including Fifth-Third and Chase, will have their own forms. Check your bank's website to see what documents they may need.
For more information on the PPP loan process, please see reach out to GHJ’s COVID-19 team.