TurnKey Lender’s H&R Block Engagement Shows Lending Tech’s Resilience

Blog Post Financing Automation & AI

Digital strategies change strategies to technologies

In recent history, systemic disruptions have hit digital strategies hard. But in the coronavirus emergency — for reasons linked to the spread of COVID-19 and for considerations of a more permanent nature — things could be different for fintechs that help other businesses achieve efficiencies and curtail facetime.

Tax Giant Seeks Efficiencies in Helping Franchisees Overcome Seasonality

Bucking an understandable trend toward slowing business activity amid global social distancing, H&R Block has turned to digital-lending pioneer TurnKey Lender. The financial-service giant wanted help addressing the cash-flow needs of its tax-preparation franchises, which experience notable seasonality.

H&R Block, which is headquartered in Kansas City, Mo., supports roughly 12,000 franchised retail tax offices in the US, and about 1,300 tax-prep storefronts in Canada and Australia. It also provides online tax and small-business services through Wave, an financial-management platform analogous to Intuit’s QuickBooks.

This Time Companies May Not Be So Eager to Put Fintech Initiatives on Hold

The tie-in between H&R Block and TurnKey Lender is noteworthy because it comes at a time when such deals have slowed in response to the pandemic. As a result, it may serve as an early example of how technologies whose time has come will find ways to buck trends.

Experts say historical disruptions — like the dotcom meltdown, the economic shocks after 9/11, and the financial crisis of 2008 — have tended to delay digital implementations by companies, sometimes setting technology rollouts back for years at a time.

This is How CIOs Usually React in Times of Economic Contraction

In a note on the impact of the coronavirus pandemic for corporate chief information officers, the consulting firm Forrester outlines what CIOs tend to do when revenues suddenly drop. In order, they usually:

  • Cut hardware spending
  • Pump the brakes on new-product initiatives
  • Conduct deep-dive reviews of existing contracts involving cloud-application subscriptions, telecoms, and outsourcing agreements to root out redundancies and uncover cheaper alternatives
  • Trim headcount

Whether or not this prescription plays out for most companies during and after the pandemic, H&R Block’s engagement with TurnKey Lender sets it apart as an early mover in a post-coronavirus world.

But Business Experts See a Prominent Place Lending Tech in the Recovery

Chastened by the current disruption, we will soon see faster “digital transformation among merchants as consumers’ shopping habits adapt” to new realities — such as maintaining a degree of social distancing even after the danger has passed —  according to Michael Reitblat of digital-fraud fighter Forter. “Merchants are scrambling to cut costs.” Of course this adage applies equally to other business types.

More immediately, H&R Block’s engagement with TurnKey Lender reflects consulting firm Gartner’s view that business leaders can soften the impact of COVID-19 and ensure operational continuity by accelerating digital initiatives.

H&R Block Taps TurnKey Lender to Help Keep Franchisees in the Game

Well before the latest business disruptions took hold in March 2020, H&R Block was steeped in seasonality. Tax time usually peaks in April for Americans, the last month of the H&R Block’s fourth quarter. Typically the company reports a loss in its first quarter, which comes right after the tax rush.

And while 65-year-old H&R Block is accustomed to earnings coming in a rush — and equally accustomed to helping its franchises bridge financing gaps in slow periods — it reached out to TurnKey Lender for help in automating and digitizing its internal lending program.

“H&R Block came to us looking for strategies to help them heighten satisfaction among their franchise owners, and to develop a funding strategy for future franchise expansion,” says Elena Ionenka, co-founder of TurnKey Lender [or another TKL exec]. “We’re perfectly positioned for that — and really for any scenario where credit-management technology is called for.”

TurnKey Offers Flexible Scoring to Support Lending to an Array of Client Types

In broader terms, the digital revolution transforming the global business landscape may not experience the delay new technologies typically endure in business downturns, according to Ionenko. “TurnKey Lender, and cloud-based fintech generally, solves problems businesses face in all economic climates,” she says.

TurnKey Lender’s white-label and fully supported Enterprise Unified Lending Management solution includes advanced reporting and analytics functionality for transferring information to and from the system in seconds, analyzing data, and creating custom reports in seconds.

“With TurnKey Lender, creditors can employ alternative as well as traditional scoring approaches drawn from an array of data sources to achieve a 360 view of borrowers,” adds Ionenko. “This frees creditors to tailor lending packages to meet their strategic needs, help their customers, and enhance the overall efficiency of their lending programs.”

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