Michigan Credit Unions give small businesses certainty during uncertain times
39 credit unions assist small businesses with 5,800 federal loans, impact 22,000 jobs.
LANSING, MI (May 8, 2020) — During the past two months of the coronavirus-related crisis in Michigan, the state’s credit unions have been focused on providing necessary relief to small business owners. These not-for-profit financial institutions have invested in member entrepreneurs through both internal loans and relief programs, as well as helping them access federal loans through the Small Business Administration (SBA)’s Paycheck Protection Program (PPP).
Though data is still being collected as the program is on-going, 53 Michigan credit unions have issued 6,015 PPP loans to business members. These loans totaled more than $363 million and have positively impacted nearly 22,000 jobs for Michigan residents.
“Michigan credit unions operate with the motto ‘people helping people,’ and during COVID-19, that means making sure the small businesses that make up the backbone of many communities are able to get the financial relief they need,” said MCUL President/CEO Dave Adams. “During times of uncertainty, Michigan credit unions have given members some stability — they know they can rely on their local credit union to help them through difficult times.”
In anticipation of the SBA’s program launch, many SBA-approved Michigan credit unions prepared for the loan process to ensure as much efficiency as possible, as well as 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.
“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.
At the time of this report, the credit union has assisted with the input of 641 applications, which were approved for a total of $37.8 million.
“Naturally, business owners are concerned for their business and their own family, but they’re also worried about their employees,” continued Salvi. “They feel a deep sense of responsibility for making sure everyone is taken care of right now, and we’re doing our best to help them achieve this.”
Of the 6,015 loans from Michigan credit unions, 606 of them (10%) are new/non-members that came to credit unions seeking assistance. Community Choice makes up for nearly half of those new business accounts.
“We attribute this growth to two things: our ability to accept applications from businesses that do not have an existing account with the credit union, and referrals from existing members,” said Salvi. “Regardless of how busy our team is, everyone is committed to providing the highest level of customer service. The pace at which we’re moving doesn’t minimize the importance of addressing individual needs and fears. This level of care, coupled with our responsiveness, has contributed to new account growth.”
Michigan credit unions had a much lower loan average than state banks — approximately $20,000 per loan to banks’ $218,000 — meaning their focus has been assisting the small businesses that may not get the same consideration at large institutions.
One business member, Matt Buskard, owner of Bobcat Bonnie’s in Detroit, said joining a credit union was one of the best decisions he could make, “During a time when we all have the option to assist others or judge them, the credit union has chosen to assist me, truly proving that we are all in this together and they are here to help.”
“Communication was wonderful, and I couldn’t have asked for a better experience during difficult times,” said one applicant and LAFCU member, David Trumpie of Trumpie Photography. “I just keep hearing stories of everyone having nightmare experiences, and everything went great for me. I will be working to move the remainder of my banking to LAFCU going forward. This PPP loan will certainly help in a very tough time.”
“Because of [Community Choice], I didn’t think that my application was just going into a black hole somewhere,” said Nicole Pasuit, CEO of TechStak in Ann Arbor. “I knew there would be follow-through … I felt confident in submitting my application and most of all hopeful.”
“There are businesses who have already opened their eyes to a credit union, and those that would benefit from doing so,” said LAFCU CEO Patrick Spyke. “Credit unions are serving small businesses … period. Many small businesses couldn’t seem to get traction with their financial institution and are now opening their eyes to the power of credit unions.”
About Michigan Credit Union League & Affiliates
Organized in 1934, the Michigan Credit Union League & Affiliates [mcul.org] (MCUL) is a trade association representing Michigan’s credit unions. Based in Lansing, Michigan, MCUL works to strengthen the credit union community and its image by providing advocacy on important issues, coordinating cooperative initiatives and by providing high-quality solutions that help credit unions succeed and enrich the lives of their members.