When the federal Paycheck Protection Program was announced earlier this year to help sustain businesses through an economic shutdown to slow the spread of COVID-19, Carpet Town USA owner Wendy Werner scrambled to connect with peers in her industry and consult with her banker.
West Allis-based Carpet Town USA, Inc. is a flooring and design center specializing in floor coverings and interior design. When Wisconsin Gov. Tony Evers’ “Safer at Home” order took effect in March, it was a challenging time for the business. Carpet Town was closed, and while Werner was able to keep busy with several in-house projects, the safety of her employees and the future of her business were top of mind.
“The first three to four weeks of the shutdown were very scary,” Werner said. “We didn’t know what would happen.”
While the health risk of COVID-19 had many focused on the present, the economic impact of the pandemic also created worry about the future.
Some business owners, by their own volition and ingenuity, learned to thrive in this new landscape. But to bring their plans to fruition, the financial services industry helped business owners navigate the complexities of the PPP.
Financial institutions throughout the country processed 4.9 million PPP loans for a total of more than $521 billion, which supported 51 million jobs and over 80% of all small business employees, according to the U.S. Department of Treasury.
At the onset of the pandemic, many business owners, including Werner, had more questions than answers. Like many other businesses, Carpet Town shut its doors. But it was unknown at the time how long the closure would last. If the business reopened, what would the day-to-day operation look like? If Carpet Town was not approved for a PPP loan, what would happen to the business, its employees and their families?
“When this first hit, it was overwhelming,” said Lynn Carlson, Johnson Financial Group vice president regional retail sales manager. “Clients shared their fears and uncertainties with us, and they were looking to us for answers and solutions as their financial partner.”
Financial institutions across the state mobilized, deploying federal funding to Wisconsin businesses as fast and as efficiently as possible. In most cases, PPP was not business as usual for lenders. The program, built by the federal government, was an entirely new system that was not without its flaws.
“I think the frustrating part for everybody is that it was brand new,” Werner said. “Every day, the government would change the requirements for the PPP loan. Sometimes within two hours we had to have different documents for what they needed.”
Understanding the nuances of the program was just part of the battle. Financial institutions had to align their systems and at times build new processes to coincide with the PPP, which meant late nights and weekend hours for many employees, said Wendy Woodson-Jones, Summit Credit Union branch manager.
“Behind the scenes, what people didn’t realize is that we were quickly moving employees into positions in our business department where we could quickly train them to help with the overall process,” Woodson-Jones said.
Not only did the industry shift its own internal processes to accommodate the PPP, several financial institutions also launched new or improved digital solutions to adjust to the growing demand of customers.
As lenders altered their delivery models, education became even more critical with customers now relying more heavily on digital solutions, Carlson said.
“We would meet with them and get mobile banking set up on their smartphone or we would go online and show them how to do a wire transfer, for example,” Carlson said. “It was very much one at a time, solution by solution, and our bankers teaching them how to use it.”
Thinking back to the first weeks of the pandemic, Werner recognizes just how critical it was that her business had established a relationship with Spring Bank, which facilitated her PPP loan.
“You want your banker to have that relationship with you of open communication and support,” Werner said. “Like I said, I’m lucky to have that.”
The challenges posed by the pandemic only strengthened the level of trust between banker and client, Carlson said, adding that educating clients was particularly rewarding for her team.
“When you can help someone reduce their anxiety, when you can reassure them ‘don’t worry, we’re here and we’re going to help you through this,’ that feels good,” Carlson said. “When someone takes the time to really listen to you, help you and then presents the solution and teaches you how to use it, that bodes well for any relationship, regardless of what industry you’re in.”