LANSING, Mich.–During the peak of the COVID-19 economic crisis, the Michigan league is reporting credit unions in the state have “stepped into a small business lending sector traditionally dominated by banks.”
Of Michigan’s credit unions, which serve 55% of the state’s population, 5.5 million members, more than 50 credit unions moved quickly to become SBA-approved lenders so as to make Paycheck Protection Program (PPP) loans available, according to the Michigan Credit Union League.
The MCUL said it estimates that more than $500 million has been loaned to more than 10,000 very small businesses, whom on average had just five employees. The median average loan size was just $20,000, and more than 10% of these very small businesses became new members after “being unable to borrow from their existing bank,” the league said.
“Credit unions continue to show their not-for-profit difference by focusing on those hardest hit, and often those left behind during a financial crisis,” said MCUL CEO Dave Adams in a statement. “The small main street restaurant, the hardworking homebuilder, the beauty salon owner and so many others have found, and will continue to find, a helping hand from a local credit union. These loans are not made for profit. The credit union mission always puts service and compassion first.”
Reaching Out
According to the league, in anticipation of the SBA’s program launch, many SBA-approved Michigan credit unions prepared for the loan process by reaching out to business members to help them prepare for the application. Additionally, 15 Michigan credit unions that were not previously SBA-approved became certified in order to heighten access to PPP loans for members, the MCUL said.
“We could not have anticipated the consistently high call volume we would receive from business owners looking for financial relief; we continue to receive calls daily,” said Molly Salvi, organizational communications manager for Community Choice Credit Union, in a statement provided by the MCUL.
The Stats
At the time the MCUL made the report, the credit union has assisted with the input of 641 applications, which were approved for a total of $38 million.
In addition, according to the league:
- Of the 10,000 loans from Michigan credit unions, 1 in 10 are new/non-members that came to credit unions seeking assistance. Community Choice makes up for nearly half of those new business accounts.
- Michigan credit unions’ average loan sizes were a tenth of the average size of bank PPP loans — approximately $20,000 per loan to banks’ $218,000 .
Canvas CU Makes Plans to Open Branches
In Colorado, Canvas Credit Union said it is reopening the majority of its full-service branch offices on May 11 and will have new practices in place to ensure safety and wellness of members and family members (employees) alike.
According to Canvas, the transformation will include guidelines for safe entry and exit of lobbies; signage to direct and limit foot traffic and help keep six-foot distances between members; facial coverings for Canvas employees, cleaning protocols, and clear communication on safety guidelines and best practices. Canvas said will also be providing vulnerable members personal appointments who may need one-on-one consultation away from others.
"The safety of our members and our internal family is paramount to our operations," said COO Chris Chippindale. "Canvas has assessed in detail how we can continue to support our community while ensuring we remain steadfast in our health efforts. And while all of our remote services and drive-thru options will always be available for our members, we believe we now have a strong approach that supports wellness in our lobbies, too.”
Drawing a Picture
In San Antonio, River City FCU has created an infographic to illustrate its participation in the SBA’s Paycheck Protection Program, saying it has helped to save 1,100 local jobs. The infographic can be found below.