The pandemic has hit businesses hard. With so many in need of assistance, the federal government and SBA are offering low interest and forgivable loans to small business owners.
The PPP (Paycheck Protection Program) is one of the most popular government-backed loan programs. In an effort to incentivize business owners to keep workers on payroll, businesses were offered PPP backed loans which will be forgiven if employee retention criteria are met and the loan is used for approved expenses like payroll, mortgage, utilities and rent.
The problem is that forgiveness guidelines make the process very time consuming. Banks can take as long as four hours to process each application, and with so many businesses applying this can really add up. Timelines are even more stressful considering banks only have 60 days to submit applications to the SBA.
Additionally, there are many factors that contribute to lengthy processing times…
Changes to Rules and Guidelines: Since the roll-out ofPPP loan, the SBA has published more than 25 revisions. Lenders struggle to keep up with current policies and integrate changes into their systems.
Fraud and Abuse: The PPP is highly susceptible to fraud. When government agencies are giving out money, you can bet everyone has their hands out, even those who aren’t eligible. In an effort to reduce fraud, agencies are requesting that lenders provide information that is clear, explainable and prevents the need for further scrutiny.
Meeting Borrower Expectations: It is up to lenders to provide borrowers with excellent service. But with current demands causing delays, customers get upset. This can lead to poor relations in the future. The need to deal with complaints can also get in the way of meeting deadlines.
Considering the state of things, PPP loan processing is costing lenders millions of dollars while increasing risk.
In order to speed up processes, banks need to update to a system that automatically integrates SBA updates and seamlessly checks for fraud to provide customers with a better borrower experience. The technology must reduce the risk of error while saving on lender expenses.
The following capabilities should be included:
· The ability to extract information and classify expenses
· Smooth integration of any application into third party systems
· The merging of submission and review to make for one seamless process.
PPP loan processing is costly and time consuming. An advanced AI solution saves lenders a considerable amount of time and money making for a less stressful experience overall. The new developments will make it easier for small businesses to get the aid they so desperately need.
Cleareye.ai has developed a PPP loan forgiveness processing engine that reduces wait times up to 70%. It is a fully automated digital engine that integrates with the flow of operations and de-risks the process. It provides a full audit trail that simplifies reviews and fully automates the system. The end result is one that ensures correctness, completeness, consistency and compliance.
Cleareye’s PPP Forgiveness processing engine provides a convenient solution that can save you time and money. Visit Cleareye.ai to learn more.