Fintech's chance to help small businesses get their stimulus loans

From unemployment stimulus to small business loans, it's now very clear the U.S. government does not have efficient systems in place to distribute aid.

Gusto tried to help pick up the slack. Its engineering team moved quickly to help get its clients to the top of the first-come first-served list "as soon as there was a little bit of clarity on how exactly to calculate the payroll loan amounts" from the Treasury Department, CTO Edward Kim told Protocol.

It took the company 12 hours to get a PPP loan calculator up on its payroll platform. That uses existing payroll information to pre-compute loan amounts in a handy, printable way.

• "We've had around 60,000 employers download their report to take to their banks," Kim said. Gusto serves more than 2% of small businesses in the U.S.; and "if you add up the total amount of dollars that they were trying to apply for, it's about $2.8 billion," Kim added.

But getting the report wasn't the main roadblock for many of Gusto's clients. "A lot of larger banks, we noticed that they were prioritizing their clients not on a first-come first-serve basis, but based on their own internal calculation of which businesses are essentially more valuable to them."

• It led Gusto to partner with other more modern, tech-enabled banks, like Cross River, to process their clients' PPP loan applications instead.
• "A lot of it can be solved by technology if there's better APIs for example, between the SBA and payroll companies and banks," Kim said.

The first PPP funding ran out in just 14 days. Round two, which the House approved yesterday, could run out even more quickly.

• "We're also doing our part to try to influence legislation," Kim said. The company has been using its data to glean early insights into termination rates, sick leave, and business closures. "We want to see a lot more funds."

In some ways Gusto has become an advisor to small businesses in these hard times, Kim said, more than just a tool. From its homepage to its Resource Hub, Gusto is all-in on coronavirus response.

• And it's working: Despite high call volumes and longer than usual wait times, their Net Promoter Score is the highest it's ever been.