Contract Simply's cloud-based construction loan software, and the CSPay feature improves efficiencies while reducing risks within the construction loan environment. It's one of many ways we're differentiating our product and service within the crowded FinTech marketplace.
Nominated for: Solving Problems Through Payments
Continued strength in the commercial real estate market is leading to a tight labor pool, a diversity of project opportunities, and faster wage growth in 2018. Both lenders and builders are looking for ways to compete, increase efficiencies, and cut costs while retaining their best talent. At the same time, funding and innovation in construction loan administration have taken a backseat to other FinTech advances, mostly in retail banking. PWC reported that Engineering and Construction trades suffer from the Longest Days Sales Outstanding (DSO) at 73 days and that 92% of the contractors in the US are small businesses with less than 20 people. Thus 10% of our GDP (construction) is being financed on the back of small businesses largely because of inefficient bank processes. Contract Simply’s mission is to improve the post-closing construction loan management process - an area that has been underserved by technology yet ripe for automation and process efficiencies. Contract Simply's best-in-class construction loan software addresses the needs of lenders, builders, and sub-contractors for what has traditionally been a manual, tedious and time-consuming process. Although Contract Simply offers many automation features for construction loan administration, I’d like to put our name in the hat for one of them - CSPay. CSPay is a first-in-market mobile and desktop B2B payment product that captures legal and tax information and automates construction payments between builders and sub-contractors. In a tight labor market, a builder's ability to pay sub-contractors quickly differentiates her from another builder across the street with Help Wanted signs. What’s more, collecting lien releases is one of the most significant challenges for builders and their sub-contractors working in the field. Same day ACH transfers through CSPay not only leads to faster payments for sub-contractors and their employees, but it also reduces borrower risk by tieing unconditional lien releases to payment acceptance. Another challenge for builders is to track down 1099’s and keep an accurate record of tax IDs and who was paid and when. In addition to automating payments and capturing conditional lien releases, CSPay also digitizes invoices, receipts, and automates 1099 tax reporting. The reality is that some sub-contractors will continue to require a hard copy payment. CSPay also prints and distributes paper checks and ties them to conditional liens at the receipt of payment. Depending on the size of the project and number of sub-contractors, a builder may spend hours per month cutting physical checks and journaling the payments. Add a few more hours tracking down conditional lien releases and 1099 information from sub-contractors. A platform that automates and records these tasks saves time and creates an audit trail that confirms disbursement of funds. If a sub-contractor doesn't pay his employees, this audit trail holds everyone accountable and protects both the lender and builder from fraudulent behaviors outside of their control. Contract Simply's cloud-based construction loan software, and the CSPay feature improves efficiencies while reducing risks within the construction loan environment. It's one of many ways we're differentiating our product and service within the crowded FinTech marketplace.