2021 CSBS Community Bank Case Study Competition Journal

SECOND PLACE: University of Arkansas

could apply for PPP funding. It also set aside $1 billion for businesses without employees located in low- and moderate-income areas, and it relaxed qualifying restrictions such as previous felony convictions and delinquencies on student loan payments. Table 3 shows that the number of PPP loans from community financial institutions rose from 4% in 2020 to 13% through May 10, 2021. The influence of Mr. Williams combined with the hard work by SBB and other CDFIs saved numerous small businesses and jobs during the pandemic. Programs During the Pandemic Due to the closed branches and prioritization of processing PPP loans, SBB had limited manpower to seek out new customers; however, bank personnel used their remaining energy to enhance their online presence and simultaneously prepare for the next generation of customers. The bank has been developing an app called Wealthable, which is an app targeting customers between 18 and 25 designed to encourage savings by utilizing incentives derived from behavioral economics. The app brushes aside traditional banking accounts and replaces them with a variety of compartmentalized accounts called vaults. If someone wants to save for college tuition, for example, they can place the funds in a vault under that title, and the app utilizes a series of algorithms that manages the funds according to the set guidelines. Another app, which the bank is most proud of, assigns a Financial Wellness Score to the user. Rather than a credit score, the Financial Wellness Score monitors account owners’ app usage and spending habits such as bills paid, amounts

True to the mission of Southern Bancorp, 80% of grant recipients were women or people of color, and 100% of the recipients were rural businesses.

deposited versus spent to result in a score that rewards healthy financial habits. After implementation of the PPP, Southern Bancorp quickly recognized that the smallest businesses in its market were being neglected by the program. In response, a grant program was created through Southern Bancorp Community Partners that raised $128,000, resulting in 128 Business Continuity Grants of $1,000 distributed to these very small businesses that could not obtain PPP loans. True to the mission of Southern Bancorp, 80% of grant recipients were women or people of color, and 100% of the recipients were rural businesses. It took the federal government until February 2021 to address the PPP’s lack of lending to the smallest businesses. Southern Bancorp had been focusing on these small businesses since April 2020, so they were well ahead of the curve. Through Business Continuity Grants and similar programs, SBB has been able to extend its assistance to those in need.

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