MILTON — Tea Jay Aikey envisions the Central PA Chamber filling in the role of a grandparent for some businesses in the Valley, offering just enough financial boost when the timing is right.
As part of its Pledged Asset Loan (PAL) program, the Central Pa. Chamber will cover financial gaps for its members when seeking a business loan, Aikey, the chamber’s president and CEO said.
“Imagine trying to secure a loan for your first car and sometimes you need something to bridge that gap,” Aikey said. “The chamber is kind of like the grandparent that helps out.”
All Central PA Chamber member business/organization and financial institutions are welcome to participate in the program. The PAL program can help when the total amount of a business loan request cannot be approved. According to Aikey, a Chamber PAL could be as high as 10 percent of the business loan, not to exceed $25,000.
Aikey said the chamber has earmarked $125,000 to start.
“As loans get paid off, we will reinvest,” she said.
Last week, Aikey and Board Treasurer Cheryl Rheppard, signed on with the Milton Savings Bank to help bring a business loan for a Central PA Chamber member to fruition. The money pledged by the Chamber will be held at Milton Savings Bank in the form of a certificate of deposit to support the loan.
“I was excited to sign the security pledge, which will enable one of our Chamber members to secure a mortgage loan to help grow their business,” Rheppard said. “The PAL program is a fantastic benefit the Central PA Chamber of Commerce offers to its members.”
Aikey said the chamber’s program offers dual benefits, both to the businesses in need of the loan and to the local provider handling the loan.
In previous programs, Aikey said the chamber lent money out directly. In doing so, inadvertently ignored the financial institutions that were members.
“Helps everyone, that’s the beauty of it,” she said. “Years ago, there were pages and pages that needed to be filled out. We said, ‘we shouldn’t vetting loans, we have members that do that.”
Now, the program allows the borrower to select the primary lender. That way, Aikey said, it could be organizations that have a previous working relationship, which can expedite the process.
“As a borrower, you are comfortable with one institution, so you can go to them,” she said. “
There are some restrictions. Both the lender and the borrower must be chamber members and must remain chamber members throughout the length of the loan along with the financial limitations. Aikey said the loans must be business loans, not personal borrowing.
“We wanted to make it very simplistic and have it available to a lot of institutions,” she said.
This program could be helpful as businesses grow and recover during the ongoing COVID-19 pandemic, Aikey said.
“We’re pleased to be a part of this program for the Central PA Chamber,” said Lisa Grant, VP/Chief Lending Officer at Milton Savings Bank. “It’s a great opportunity for our customers and Chamber members. It gives them the opportunity to make a down payment, which they may not have had.”