The Regional Investment Corporation (RIC) is focused on loan timeframe improvements as it deals with unprecedented application numbers.
When the RIC was established in July 2018 it was anticipated it would receive 300 – 500 loans applications annually yet has consistently received hundreds each month since the beginning of this year, which has resulted in delays.
RIC CEO Bruce King said additional operational funding announced in July 2020 is enabling the RIC to improve processing times from a current average of 11 months, from when a completed application is submitted, to a RIC loan handling time of 65 days (excluding third parties) for 80 per cent of its loans.
“We know that the improvements we have started to put in place are working, in August 2020 the RIC approved a record of more than 140 loans valued at almost $140 million. But there’s still more work we need to do,” said Mr. King.
“We’re aiming to decision 200 loan applications this month and 300 in October.
“We are also changing the way we handle loan applications to provide a faster and simpler assessment process for low risk applications, which we plan to have in place in the next couple of months,” he said.
To assist in managing this additional demand and reducing the time taken to process loans, since 1 July 2020 the RIC has engaged 36 additional staff as at 24 September 2020, with its lending service partner also increasing staff numbers by 33.
In August 2020, average RIC loan processing times were at around 11 months to settlement from when a completed application is submitted, the longest part of the process being settlement, which is taking just over six months.
“We know our loans are adding value based on the demand we have had and they’re making a meaningful financial difference to farmers and farm-related small businesses with loans valued at over $1.1 billion approved since July 2018,” said Mr. King.