When the U.S. Department of Agriculture’s Farm Service Agency analyzes a loan application, it uses a process tha’s little changed in the past 60 years.

The process will start changing this week, as the FSA begins rolling out a new software program designed to accommodate today’s more sophisticated agriculture financial situations. The new system will also allow applicants and lenders to file applications electronically.

“We just see it as really speeding up the process and allowing us to give them a more timely response,” said Mike Hinton, the FSA’s branch chief for direct loan making in Washington, D.C.

Farmers will have the option to complete an application online and submit it electronically, rather than having to download it and complete it manually.

“From a farmer’s perspective, they’ll no longer have to drive in to the office to apply,” Hinton said. “So we see a lot of time savings in travel. For the guaranteed lender, we’re averaging about three to five days on approval. I think we can get that down to one day.”   

ECI, a southwestern Iowa software development company based in Glenwood, was chosen by FSA through a competitive bid process to provide the software. The company’s Web Equity Manager package is currently used by more than 6,500 banks and credit unions in North America.   

The total cost to the FSA to upgrade to the new system, including support and training, will be approximately $4.8 million.

About 2,100 FSA employees will be trained on the software through September in Omaha, in one-week classes of about 100 each.      “Our loan officers will use it immediately with the farmers we do direct loans with,” Hinton said. “Any lender that is currently using the ECI program will be able to send us a complete loan application. Other lenders that use some other program out there, in about 12 months we’ll give them access to use our system if they choose to.”

Besides allowing the FSA staff to spend more time with farmers, the upgraded system will also provide farmers with better tools for analyzing the financial aspects of their operations, he said. The program can provide trend reports, average cost reports and sensitivity analyses.

Farmers will need to visit their FSA office before using the secure system the first time to receive a log-on and password. The agency expects to have the system implemented internally by October available nationwide to lenders and farmers by this time next year.