Recovery Loan Scheme – how you can find the right customers, onboard them faster, and keep them beyond the life of RLS

The treasury is considering extending the Recovery Loan Scheme (RLS) past its 31st December 2021 deadline. Are you able to keep up with continued demand?

What is RLS?

Businesses across the UK have received almost £80 billion worth of emergency government-backed loans during the Covid crisis. Over 1.67 million loans have been provided, protecting millions of jobs and livelihoods across the UK at a time of unprecedented uncertainty and crisis.

The Government-backed RLS scheme, which is a successor to previous state support loan schemes such as CBILS and Bounce Back loans, was brought into action in April 2021 in order to keep providing valuable assistance to businesses as they recover from the impact of the Covid pandemic.

As Lee Rhodes, commercial director, asset finance at Aldermore, so rightly says, “small and medium-sized enterprises are the backbone of the UK economy, and it is our mission to do everything we possibly can to help them succeed.” 

Major banks, alternative lenders and even peer-to-peer platforms have been accredited to deliver RLS loans, which can be used for any legitimate business purpose or growth strategy – managing cash flow, investment, buying equipment, hire purchase, finance lease, sale and HP, invoice finance, helping with payroll, pivoting to e-commerce and so on…

The challenge of assisting recovery

RLS offers a fantastic opportunity to provide liquidity solutions to British businesses on an unprecedented scale. Providing them with the finance they desperately need as the economy continues to recover from Covid. But…

There’s always a but isn’t there! The challenge is to make it easier and faster for businesses to apply for and gain approval to receive RLS funds, within regulatory guidelines as well as within the remit of your own risk parameters and client profile requirements.

If the deadline is extended, then banks and finance providers will continue to feel the pressure to meet the demand for some time to come.

How to expedite RLS approval and onboarding with data science

Time-sensitive market opportunities like RLS require banks and financial institutions to be agile.

Each lending institution has in own unique way to register RLS applications, usually by way of an online portal, which applies the Government’s basic bank lending criteria to the SME applying for support. But what if you could expedite the application approval process with an advanced triaging capability, that gathers the data and information required to process the loan in advance of any Relationship Manager involvement?

Well, you can! Data science is providing new opportunities to carry out smart accelerated pre-screening on RLS applications, to quickly validate and prioritise resources on the most viable options. Utilising credit risk data and company financial data via APIs, and using a series of bank-approved decision rules, can provide an immediate summarised view of risk, flagging any potential problems that may arise.

Sound too good to be true doesn’t it…? Well, Artesian Connect™ does exactly that. Banks and other approved RLS lending providers simply define their own parameters regarding acceptable risk thresholds and the service is ready to go.

Take Triodos for example – a world leader in sustainable banking, who has been using Artesian for smart accelerated pre-screening and triage capabilities since the early days of CBILS. They’ve not only been able to respond in an agile way to a huge surge in demand, but by layering unstructured data to intimately understand their customer’s world, sustainability risks and opportunities, they have also ensured they meet their own strict lending criteria rules.

Typically, Artesian Connect reduces time spent in the data-gathering phase of RLS onboarding by 90%, meaning banks and lenders could take a big step towards keeping up with demand and clearing the current bottleneck in applications and keeping up with demand for the long term.

Retain valuable business customers beyond RLS

The probability of selling to a new prospect is 5-20%, whilst the probability of selling to an existing customer is 60-70%. It’s more cost-effective too. Hubspot estimates that it is 5-25x more expensive to acquire new customers than it is to grow existing customers.

You now have a huge pool of new customers to convert into fans, as well as the opportunity to attract RLS customers away from banks and alternative loan providers that have been less agile in meeting their needs.

Artesian’s powerful web application and advanced rules-based insight engine, in tandem with DueDil’s Business Information Graph and Premium APIs (did you hear that we have merged?)  delivers a powerful solution that will allow banks, insurers and financial services companies to do better RLS business, faster, but also help retain these customers for the long term with real-time insights and continuous in-life monitoring to identify risks and opportunities and assist with customer remediation.

Talk to Artesian and DueDil and keep your RLS response agile through 31st December and beyond