Banks are feeling the pressure of small businesses nationwide applying for Paycheck Protection Program loans. With the launch of the Small Business Administration’s program Friday, bankers are engineering the best ways to handle the customer service inquiries flooding banks’ digital channels.   

“We dove headfirst into this,” said Becky Buhr, vice president of finance and retail manager at Bank of Franklin County, a Washington, Mo.-based bank with $273 million in assets. “Last Thursday and Friday we were on the phone calling every small business customer we know and every business in town.” 

The PPP loans have their own unique parameters and requirements, which small businesses must race to understand as they apply for some of the $349 billion Congress set aside for them as part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. With funds available on a first-come, first-served basis, banks are working to answer business clients’ inquiries efficiently without overloading their own systems. 

Bank of Franklin County has processed 74 SBA loans for a total of $11 million since Friday, and has more than 140 loan applications in its pipeline. Buhr said a good month for the bank’s commercial lending business before COVID-19 would be $5 million total. Bank of Franklin County processed its first SBA loan at 8:30 a.m. local time on Friday.  

Customer confusion is natural for a massive program spun out a week after congressional approval and Buhr said the bank has pulled employees with strong business acumen from throughout the bank to help with the loan applications. For example, she is helping with the program although she isn’t a commercial lender. The bank is also broadcasting information on its Facebook page, and it has a page on its website dedicated to the PPP loans. Buhr said clients receiving a PPP loan must open a new checking account with the bank, even if they already have a pre-existing one, in order to clearly demonstrate 75% of the loan is going to payroll. The bank is also using remote signatures and secure emails to ensure safe, efficient processing. 

Other banks, meanwhile, are turning to chatbots to handle the influx of customer service inquiries around the SBA program. New York-based Kasisto, a conversational AI company that works clients like JPMorgan Chase and TD Bank, has developed new functions to help its clients handle SBA loan questions. Kasisto’s technology can answer FAQs like “Does my business qualify for the SBA program?” and “What information do I need to provide to get these loans?”  

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“The most daunting challenge with the SBA platform is that it is difficult to get clear answers to fundamental questions,” said Stephen Epstein, chief marketing officer at Kasisto. “And because the recent stimulus program doesn’t include specifics on how these government-funded programs operate, answers on the platform are continually changing.” 

The $2.4-trillion-asset Bank of America is also using chat features to serve the influx of small business clients. According to a bank spokesperson, more than 250,000 of the bank’s business clients have applied for PPP loans since Friday morning. BofA’s virtual assistant Erica can now answer questions about the CARES Act and guide clients to the PPP application. 

San Mateo-based Interface, another conversational AI company, offers an AI-powered call center and a digital chatbot that walks small businesses through the SBA application using everyday language. As clients respond to the text-based chatbot, the technology automatically fills out applications for them. For complicated questions, the chatbot provides a list of options for small businesses to choose. Interface’s clients include Texas Dow Employees Credit Union and Security Service Federal Credit Union. The company, which has worked on the solution for about a week, is in talks with about 10 new financial institutions and is working to onboard existing clients.  

The New Orleans-based Gulf Coast Bank, which has $1.7 billion in assets, said the bank is now starting to hit its stride with the PPP loans. “It’s been an interesting few days, to put it lightly,” said Jason Shields, vice president and loan operations manager at the bank. “We are just devoting all resources to it and getting through the flood as quickly as possible.”  

But even devoting extra resources to the loan volume can’t control hiccups from added stress to the SBA E-Tran system. “The E-Tran system was down yesterday, and it is a significant bottleneck right now for every single financial institution,” said Srinivas Njay, founder and CEO of Interface. “That has been a significant challenge.”