Kristen Smith
Allocore has released a report providing recommendations to modernize the federal credit ecosystem, which runs on aging infrastructure and faces challenges, including fragmented operations and the departure of key personnel.
The report, titled “Unlocking the Future of Federal Lending,” proposes strategic investments in shared services, commercial-first technology and modern data frameworks to build a more resilient and efficient lending system, Allocore said Monday.
Issues Facing Federal Loan Programs
Published following a roundtable on public sector lending hosted by the DC Chapter of AGA and sponsored by Allocore, the report highlighted the issues identified by senior government officials, lending and credit program experts, and technology leaders, including a talent gap in loan programs across the federal government; the use of separate systems by over 130 federal credit programs, creating unnecessary complexities and system redundancies; outdated federal lending tools that cannot interoperate across programs, even within the same department; and obsolete statutes like the Computer Matching Act and outdated privacy laws hindering real-time data sharing among federal credit programs.
Key Recommendations to Improve Federal Credit Ecosystem
To address the issues, the report recommended to launch a cross-agency effort to develop shared system requirements and define standard administrative needs; build out a lending-focused quality service management office or center of excellence to act as a shared service provider and marketplace; engage the Office of Management and Budget and the General Services Administration to align administrative budgeting and acquisition tools with modernization goals; and develop an interagency borrower experience initiative that applies the Evidence Act, which requires changes to how the federal government manages and uses the information it collects, to enhance loan program design.
“Improving the way we deliver loans and grants at the federal level isn’t just about efficiency—it’s about unlocking opportunity and building trust in the institutions designed to serve the public,” said Ben Wallace, founder and board chair at Allocore.
