Based on data provided by the U.S. Small Businesses Administration (SBA) this week about Paycheck Protection Program (PPP) loans, Mississippi is tied with three other states as the 10th most efficient state in allocating PPP loans to small businesses. Georgia, Nevada, and Kentucky also ranked 10th. The data disclosure provides information about the 4.9 million PPP loans that have been made nationwide since the program launched in April.
Through the 45,817 PPP loans approved by the SBA in the state, Mississippi banks covered 86% of the state’s eligible small business payroll, supporting 400,000 Mississippi jobs during the first few months of the pandemic. The vast majority of the nearly $3.2 billion in PPP loans made in the state were originated by banks headquartered in Mississippi.
“By passing the CARES Act, Congress and the Trump administration wisely placed banks squarely in the middle of the nation’s economic response to COVID-19. Mississippi’s banks worked hard to originate loans for all sorts of local businesses, and that shows through in the new data – Mississippi was one of the most successful states at distributing PPP loans in the country. Banks are working with customers now to help borrowers understand loan forgiveness,” said Andy Anderson, president and CEO, Bank of Anguilla, and 2020-2021 Mississippi Bankers Association Chair of the Board of Directors.
In releasing the June 30 data, the SBA reported borrower and lender details for all loans greater than $150,000. Of those $150k or greater loans, 3,890 were made in Mississippi; 41,927 PPP loans in the state were under $150k. More than 90% of PPP loans made in Mississippi were less $150k.
The average PPP loan amount in Mississippi stands at $69,088, the lowest average loan amount in the country. This average shows that Mississippi banks made a lot of loans to self-employed and truly small employers. The average loan amount in the country is $107,000.
The sudden shock of temporary closures and other safety measures taken to “flatten the curve” affected businesses of all sizes and industries. The new data shows that Mississippi businesses with 500 employees all the way down to self-employed individuals benefited from PPP loans. Almost every industry in Mississippi appears on the SBA’s PPP report: medical offices and hospitals, nursing homes, law firms, construction companies, furniture manufacturers, retailers, restaurants, religious organizations, childcare facilities, non-profits, car dealerships, educational institutions of every level, agriculture related companies, farms, and more.
“You can’t have national security without food security. As an owner of a farming and trucking business, we have to get the crop planted each year. Prior to the COVID pandemic, we were already operating with tight margins due to commodity prices and weather patterns. We’re thankful for the PPP loan. Since March, we have had crew members quarantine because of COVID exposure or a positive COVID test. Having a truck or tractor sit for two weeks straight while a driver is recuperating and quarantining has a big impact on our profitability. This loan has given us some peace of mind as we continue to navigate these tough times,” said Jeremy Jack, Silent Shade Planting Company, Belzoni.
The success of the PPP program in Mississippi is a great example of the important role that local banks play in supporting their communities. 93% of PPP loans disclosed by the SBA were originated by MBA member banks, which includes nearly all banks that have branches in the state.
“It speaks highly of our state’s banking industry that more than 90% of PPP loans were made by local banks with branches in Mississippi communities – not out of state fintechs or banks that do not have branches in Mississippi. PPP is a great example of how local banks like the banks we have here in Mississippi are committed to supporting their communities,” said M. Ray “Hoppy” Cole, president and CEO of The First, A National Banking Association, Hattiesburg, and 2020-2021 MBA Vice-Chair.