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New small business loan program offers money without red tape

Relief is on the way for small business owners. Applications for new loan program open Friday.

SCRANTON, Pa. — Widmer Signs is one of the hundreds of businesses in the city of Scranton that has temporarily shut its doors. 

Two weeks ago, husband and wife Todd and Jenny Collins made the difficult decision to lay off all 10 of their employees.

"You know, my husband and I have owned the business for over 20 years. We have fought floods, we have fought fires, being robbed, but this is just such an invisible enemy," said Jenny Collins.

Collins has spent her days away from her business, scrambling for information from the government. 

Hope finally came in the form of a new small business loan program, part of the federal coronavirus stimulus package.

"This particular loan is gonna allow me to get all of my employees back. We have work to do in the shop, sitting there, waiting to go. So when the governor says it's safe to go back to work, I want to bring everybody back immediately," said Collins.

The loan program is called the Paycheck Protection Program. It's open to businesses and nonprofits with 500 or fewer employees, as well as self-employed individuals and independent contractors. The idea is to get money in the hands of small business owners quickly, so they can rehire their laid-off employees.

"Basically what it's doing if you could just picture the stream the federal government is flowing dollars through the financial institutions into small business owners, as they classify with less than 500, into the consumer's hands," said Jerry Champi, FNCB Bank President.

Business owners can apply through their bank.

FNCB Bank, based in Dunmore, has already been slammed with inquiries from hundreds of business owners. 

"This is the first time that this application process is very simplistic. It is a two-page application. It is a PDF-fillable document which makes it very, very efficient," said Champi.

"The application was simple. It maybe took 15 minutes, at most, to fill out," said Collins.

The amount of the loan will be based on the number of employees. 

In order for the loan to be forgiven, business owners must commit to bringing back their employees by June 30.

"We're hoping that a majority, if not all, can be forgiven. But we're also telling our clients that there is a chance that a portion of this may not be forgiven. As a result of that, this loan carries an interest rate of one half of 1%. It will come due in two years. And we're hoping that we can get most of our clients, either 100% forgiven or at least a majority of it forgiven, and then we'll work off the balance if that's necessary," said Champi.

Applications for small businesses open on Friday. 

Self-employed individuals and independent contractors can begin applying on April 10.

You can find the application here.

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