Fintech company Jack Henry & Associates has unveiled a tool to help lenders managing Paycheck Protection Program, or PPP, loan forgiveness. The announcement came days after the Small Business Association issued guidance on the forgiveness process.
According to the release, the tool will automate many of the processes for lenders by minimizing data entry. The entire process can be branded by the lender and will be available to all financial institutions.
The company said it has already advised around 300 financial institutions in processing 60,000 PPP loan applications. Founded in 1972, the company serves more than 6,000 financial institutions and companies by building tools to streamline processes.
“The work is not over,” Terry Renoux, group president of Jack Henry Lending, said. “While we are still waiting on the SBA to offer its final guidance on the forgiveness process, it is important that we provide our strategy and tools early, helping position banks and credit unions for a successful follow through and enabling businesses to get back on their feet more quickly.”
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Last Friday, the Treasury Department relaxed requirements for converting a PPP loan into a grant and released a term sheet laying out guidelines for borrowers. The terms appeared to ease a requirement that businesses rehire a certain percentage of employees. The requirement that businesses spend at least 75% of the loan on payroll and the rest on rent and utilities remains.
The finalized guidelines have not been released by the SBA, although Jack Henry Lending said it expects that businesses will begin applying for forgiveness in June, eight weeks after the first round of funding.
Congress allotted $349 billion to the PPP program as part of the $2 trillion CARES Act passed on March 27. Funding dried up in less than two weeks with critics saying that the program favored larger lenders over small community banks. Congress later replenished the program with an additional $310 billion and put restrictions that required more funds to be directed to smaller lenders.