Running a small business is exhilarating, exhausting, and essential, as companies of 500 or fewer people employ nearly half of the American workforce. But with the unprecedented COVID-19 pandemic stalling much of the economy, a remarkably difficult time for small businesses emerged. Millions of entrepreneurs and business owners have seen their customer bases shrink, stores left unvisited, and offices empty for the better part of four months. At the same time, rent, bills and other financial obligations have continued to pile up, which has led to layoffs and other expenditure cuts.
As a result of COVID-19’s devastating impact, Congress came together in an emergency session and passed the CARES Act, which provided much needed stimulus funds to impacted Americans, including small businesses. A key provision in the CARES Act was the Paycheck Protection Program (PPP), a $349 billion loan fund to help small businesses and other eligible organizations keep the lights on and employees on payroll; it later almost doubled to $669 billion as the number of unemployed Americans topped 40 million.
The Small Business Administration approved fintech companies for the first time as lenders, with QuickBooks Capital among the first, giving small business owners more options when looking to secure loans.
Intuit’s financial management platform QuickBooks already makes payroll, tax time, and other financial tasks quick and easy for six million small-to-medium-sized businesses and self-employed. Of those six million users, 1.4 million use QuickBooks for payroll services — 80 percent of those businesses have less than 10 employees, while 57 percent of them have five employees or less. QuickBooks Capital was able to develop a fast and easy, automated PPP application process for these kinds of businesses that were left out at the beginning of the PPP process.
Behind the scenes, Intuit fast-tracked its efforts on multiple fronts. After it sorted through the regulatory matters, the company submitted its application and QuickBooks Capital was approved as an SBA lender within 48 hours. At the same time, the engineering team built an integrated PPP application process inside QuickBooks Capital for its customers, completing it in a lightning-speed, two-week sprint.
“Seeing the impact COVID-19 had on small businesses inspired us to move quickly,” said Luke Voiles, VP and Business Leader of QuickBooks Capital at Intuit. “Those with physical retail locations needed to shut down and all small businesses needed to figure out how to serve their customers in new and different ways. Small businesses have tight margins in the first place so any percentage drop in revenue is going to be massively problematic for them and the millions of employees they pay.”
In many cases, small business owners and entrepreneurs that applied through big banks were saddled with requests for records that were scattered all over the place, from the filing cabinets of different accountants to random digital folders saved on various computers. QuickBooks customers, on the other hand, already have most of their records, including payroll, Schedule C tax returns, monthly revenue and expenses, all in one place — in the product.
“We were positioned very well for PPP,” Voiles said. “We have the data, and with the customers’ consent, we’re able to automate the loan application process.”
Approximately 90 percent of all QuickBooks users who applied for a PPP loan within QuickBooks Capital had their application process automated. With a few clicks, relevant data was auto-populated — pulled in automatically from QuickBooks as well as TurboTax (also owned by Intuit) — to produce an application ready for customers to review, verify, and submit.
On average, the process to apply for a loan took QuickBooks Capital users minutes to complete.
And while the application process was fast, so was the time it generally took to receive approval for the loan. “Over a third of our PPP loans were approved within 10 minutes,” Voiles said.
“Taking paper-based dependencies out of processing plays directly into our core mission and goal of taking financial, highly-regulated tasks and making them seamless and automated. We want your business to run itself so you can focus on growing it, talking to your customers and doing what you love versus having to manage all these tasks on the back end.”
Approved and accepted loans were quickly deposited directly into the accounts of QuickBooks customers. With 1 in 12 Americans paid through QuickBooks, the speed wasn’t just about convenience, it was necessary to get millions of Americans their paychecks on time.
So far, QuickBooks Capital has been able to help over 31,000 small-to-medium-sized businesses obtain PPP loans, and facilitated more than $1 billion in SBA-approved PPP loans for QuickBooks customers. These QuickBooks Capital-enabled loans have helped pay an estimated 186,000 employees.
“PPP allowed us to take all of these pieces we already had and quickly put them together into a seamless solution that provided relief to our customers,” Voiles said. “We’re super proud of how many customers we were able to help and how fast we were able to do it. That made the long nights and weekends worth it.”