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Jan. 17, 2019
At one point, the leaders at First Dakota National Bank wondered whether putting together a loan program for workers affected by the partial government shutdown was going to be worth it.
Would the government reopen within days of the bank launching the program?
Were they really going to be able to help anyone?
But within hours of launching the no-fee, no-interest loan program one week ago, it became clear the demand was big.
“You never know what to expect, but I would say the demand has been higher than we expected,” bank president Rob Stephenson said. “It’s been really busy.”
About 30 federal employees have taken out loans totaling more than $400,000, he said.
“We’ve been particularly busy in Sioux Falls, but that shouldn’t surprise us,” Stephenson said.
The majority of customers are coming in because they don’t have enough funds set aside to cover their living expenses, he said.
“They have to find some other way to pay their bills. They’re living paycheck to paycheck. That’s the primary story we’re hearing.”
The bank created a simple process that still satisfies its regulatory responsibilities, he said. Customers can bring documentation, including a paycheck, and leave with take-home pay for up to 90 days in less than one hour.
First Dakota set aside $5 million for the program “so we’re not close to running out,” Stephenson said. “If it drags out a long time, we’ll make new decisions. But we tried to make it available. We didn’t try to limit it.”
More than 80 percent of the loans made were to people who weren’t previous First Dakota customers, he said. Other federal workers have come in to thank the bank for offering the program even if they don’t need assistance.
“We’re doing it to help,” Stephenson said. “Certainly, people coming in are very pleased with us and grateful and indicating they don’t know why they’re not banking with us, and we invite them to do that. But we’re not going to push pressure on them to do that. If we happen to get customers because of it, great.”
Meanwhile, the calls keep coming, he said, including some from out of state. First Dakota limited the loan program to people in its service communities or surrounding areas: Beresford, Blunt, Chamberlain, Elk Point, Kimball, Mitchell, Oacoma, Parkston, Pierre, Salem, Sioux Falls, Vermillion, Wagner and Yankton.
“They usually say, ‘Is this for real? What’s the catch?’ And we say we’re trying to help,” Stephenson said. “We like to help in our communities. It’s important.”
Applicants must be credit qualified and can take advantage of the bank’s Federal Employee Shutdown Relief Program up to 30 days after the government reopens.
Other banks in Sioux Falls are reaching out to their customers asking them to reach out for assistance if needed.
Within hours of launching its no-fee, no-interest loan program for federal workers one week ago, it became clear to First Dakota National Bank that the demand was big.