PPP prompts offers of free automation solutions

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The second round of the Paycheck Protection Program (PPP) launched this week and, following Google’s lead, BankLabs is offering a free tool to help automate aspects of that loan process.

Little Rock, Ark.-based BankLabs, which provides cloud-based banking solutions, is offering free access for a year to “Participate,” its loan participation automation platform. The platform is designed to help banks participate on PPP loans, said co-founder and President Matt Johnner.

A participation loan is made to a single borrower by multiple banks, allowing participating lenders to handle larger loans than they might normally be allowed to issue. Such loans can reduce banks’ balance sheets, enabling them to originate more loans.

“On PPP loans, we truly feel like that is just the part we can play. And we have revenue from other operations,” Johnner said. If after the free year banks want to continue using the tool, then BankLabs “will ask them to pay something, but [it’s] truly free for PPP, no strings attached,” he added.

The Participate cloud-based solution automates participation loans by allowing banks to upload the loan information and send a link to a partner bank. The partner bank can create a free account to access the loan information and decide whether to accept the deal. If the bank decides not to participate, the originating bank simply sends out another invitation, rather than manually printing and mailing new paperwork.

Already, about 60,000 PPP loan applications have been submitted by nearly 3,000 lenders during the first week of this PPP round, according to a U.S. Small Business Administration statement Tuesday. The SBA limited lender participation for Jan. 11 to 17, to community financial institutions that specialize in underserved communities and smaller lenders. As of Tuesday, the PPP has been open to all participating lenders.

Technology vendors are finding that PPP is good for business. Terry Renoux, head of Jack Henry Lending, told Bank Automation News Jack Henry has seen more interest in automation since the first round of PPP. The Monnet, Mo.-based tech company processed more than 70,000 loans with a total of $6.5 billion in PPP requests in the first round. Bluevine, a fintech lender based in Redwood, Calif., told BAN it has experienced nearly 600% customer growth since the first round of PPP loans.

This explosive growth has led to some vendors offering free services for PPP. Last May, Google offered its PPP Lending AI Solution for free. The three-part solution incorporated a web-based loan processing portal that allowed lenders to track application status; a document parser tool that provided structure for unstructured data; and a forecasting analytics tool for assessing risks within lenders’ portfolios.

Data aggregator Boss Insights also offered its PPP application for free on the condition FIs using it would fund business they hadn’t previously funded, Boss Insights CEO and founder Keren Moynihan told BAN. That strategy paid off for the Canada-based startup in the form of a Forbes article and a subsequent partnership with Oracle. Boss Insights last year participated in BAN’s sister accelerator program for financial services, INV Fintech, which connected the two companies.

“Oracle saw that listing and said, ‘We want a PPP platform to take to our clients. We’d like it by Friday,’” Moynihan said. “We said, ‘No problem.’ That was Monday at midday, and we did it.”

Bank Automation Ignite, taking place March 2-3, 2021 as a virtual experience, is the event for inspiring automation initiatives and investment in financial services. Formerly the Bank Innovation Ignite conference, this new focus creates an event where financial services professionals can discover new use cases and technologies that are accelerating automation in banking. Learn more and register for the event at www.BankAutomationIgnite.com.

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