Government-guaranteed lending requires special expertise and back-office functionality that grows increasingly expensive for smaller banks. On the latest episode of the ABA Banking Journal Podcast — sponsored by Bix2x — Chris Hurn and Jeremy Gilpin of Community Bankshares, a bank holding company in La Grange, Georgia, discuss how they are tackling that challenge.

"To start one of these departments is very expensive for a lot of rural banks and credit unions," says Gilpin, "It's very prohibitive to enter the market space if you are a rural bank or even in an urban market where you do you know, maybe 5, 10, 20 of these loans a year."

Hurn and Gilpin are part of a team that has built Community Bankshares, parent of Community Bank and Trust of West Georgia, into a network of Small Business Administration and U.S. Department of Agriculture lending subsidiaries that work on a nationwide basis. They developed a model that allows the "the holding company [to] serve as a source of strength for the bank, not just the other way around, which is typical," says Gilpin. Gilpin and Hurn discuss the company's role as a white label lender, referral lender, participation partner or servicer for smaller banks that want to connect their clients to guaranteed loans and the strength of the bank model for supporting these businesses and agricultural enterprises.