In a major boost for the state’s economy, Hawaii banks collectively have secured $1.6 billion in federal relief funds for more than 7,500 local companies, a local banking association reported in the first public statement showing just how much money an SBA program is generating locally.

The money is part of a $349 billion package for small businesses, which was crafted quickly by Congress and signed into law by President Trump on March 27 as the COVID-19 crisis descended on the U.S. economy. A major question was whether Hawaii would get its fair share amidst a national rush for the money, which was distributed by banks as loans.

Rich Wacker, the chief executive of American Savings Bank and president of the Hawaii Bankers Association, commended the state’s banks for scaling up quickly to administer the Paycheck Protection Program, which went live on April 3. It is part of the $2.2 trillion Coronavirus Aid, Relief, and Economic Security Act signed into law by President Trump on March 27.

“Our lender banks worked swiftly to make the application available to customers and staff up immediately to accommodate the high volume we anticipated,” Wacker said in a news release. “Despite this being a brand new program with changes and conditions communicated on almost a daily basis, Hawaii bankers have worked around the clock to secure essential funding for more than 7,500 Hawaii businesses in just eight days.”

In addition to First Hawaiian, the association’s members include American Savings Bank, Bank of Hawaii, Bank of the Orient, Central Pacific Bank, Finance Factors, Hawaii National Bank, HomeStreet Bank, Ohana Pacific Bank, and Territorial Savings Bank.

The program is designed to encourage small businesses to keep workers on their payrolls, even if business is stopped or diminished by widespread stay-at-home orders imposed by state and local governments across the U.S. to limit the spread of the virus. The goal is to keep providing paychecks for workers and to enable businesses to reopen quickly once stay-at-home orders are lifted.

Firms can get loans of up to 2.5 times their monthly payroll, and any amounts spent to pay employees are forgivable, making the loans more like grants. Firms that have laid off workers can rehire the workers and put them back on the payroll, and the loans still will be forgiven. In addition, borrowers can spend up to 25 percent of loan proceeds on other expenses, such as lease payments and utilities, and have those amounts forgiven as well.

Other loan amounts carry interest of 1 percent for 15 or 30 years.

The program has proven so popular that the $349 billion is expected to run out soon, and lawmakers are working to give the program more money. In the meantime, U.S. Senator Brian Schatz, a member of the Senate Banking Committee and the Senate Appropriations Committee, encouraged struggling businesses to reach out to their banks for help.

“Many more people still need help and time is of the essence,” Schatz said in the news release. “That’s why I’m fighting to make sure SBA moves quickly and that this program gets more money.”

Despite the program’s success, there are limitations. Businesses in locales with high lease payments relative to their payrolls, such as Honolulu, have said the program is not ideal for them.

In addition, program-mandated timelines for rehiring staff and uncertainties about when customers might return pose problems for hospitality industry businesses like hotels and restaurants. Some of these are pushing for a different form of relief from Congress, such as a program that would reimburse insurers that make good on claims under business interruption policies.

Still, $1.6 billion for Hawaii, with the bulk intended for workers, is hardly chump change.

“The Paycheck Protection Program has been successful,” Peter Ho, Bank of Hawaii’s chairman and chief executive, said in an interview. He added that technical kinks or shortcomings are understandable given the speed at which Congress passed the legislation.

As Congress rolls out additional relief for businesses, Ho said in an interview, ease of use will be key.

“The simpler they can make this the better,” he said. “Complexity is just not a friend of effectiveness.”