In the wake of COVID-19, small business owners in Maricopa County turned quickly to apply for, and receive, financial assistance through the Small Business Administration Paycheck Protection Program (PPP). Arizona Federal Credit Union quickly responded to this influx of requests from its member-owners to help them navigate the process and get the business-saving loans to keep them, and their employees at work. Through the first two rounds of funding, Arizona Federal has now executed more than 450 total loans with a cumulative payout over $45 million.
When the The CARES Act was initially signed and $349 billion was allotted to PPP on March 31, Arizona Federal’s small business loan department sprung into action, receiving more than 500 requests in the first 72-hours. The locally owned and operated credit union began processing requests for its member-owners first to determine if they might be able to take additional non-members on, but through round one funded 168 loans for a total of $27.6 million.
“In good times and in bad, we want to be there for our member owners,” says Jason Paprocki, Arizona Federal’s chief operating officer. “But that first round was difficult as we had to quickly assess the parameters of the loan program and build a process to assist our business owners. In the end, we were pleased to execute on so many loans before the appropriated funds were exhausted, keeping 168 businesses, and countless employees receiving paychecks.”
The credit union has since cleared all pending applications for the second round of funding with 284 loans in process to the tune of $17.5 million. A key factor in Arizona Federal’s ability to act nimbly was their recent acquisition of Pinnacle Bank in December who was an approved SBA 7(a) lender and all employees were retained in the deal. Expertise was quickly shared internally which allowed a combined team of over 50 to process loans at a speed and scale that would have been impossible for either organization previously, ultimately benefitting hundreds of small businesses throughout the Valley.
“One of our members who owns a construction company called to thank us and let us know they were down to their last $3,500 until the PPP funds hit and they were able to keep 60 employees paid and at work,” says Paprocki. “That sort of story just reminds us that these are not just numbers on paper, but people’s livelihood at stake and we are just thankful to have the opportunity to help.”
A third round of PPP loans is being considered by the federal government, but as of May 5h, funds were still available through the second round. Arizona Federal is still taking applications from existing members .
Arizona Federal is a $1.9 billion not-for-profit, local cooperative providing financial services and expertise to more than 130,000 member/owners. Founded in 1936, the credit union empowers members to take hold of their financial future through the delivery of leading-edge self-service tools and mobile apps, competitive rates on loans and deposits, robust home loan solutions, small business services and commercial loans, identity protection services, and annual member payouts when the cooperative does well. Arizona Federal has a history of local community involvement and is the naming rights partner of the LiveNation Theatre venue and exclusive credit union partner of the Phoenix Rising FC. The credit union has 16 locations across the Phoenix metropolitan area. Deposits are federally insured by the National Credit Union Administration.
