5 Steps to Boost Digital Lending in Financial Services

Average time taken to cross the Atlantic in the 1900s: three weeks. Now: approx. three hours.

Average ‘time to decision’ and ‘time to cash’ in traditional financial services for retail lending & corporate lending: three weeks. How can you bring it down to mere minutes today?

For financial firms, credit is at the heart of customer relationships. Digital metamorphosing of end to end digital lending journeys with support customer acquisition and service processes are bringing about a digital lending revolution.

Key thrusts in digital lending, be it for retail lending or corporate lending are on:

  • Digital transformation in core banking and digital LOS implementations on a unified platform.
  • Embedding customer point of view (POV) while designing and deploying digital lending journeys.
  • Taking leadership in the industry with an organization wide digital driven approach.

The key 5 steps that can boost digital lending with seamless digital lending journeys are as follows-

1. AI driven risk analysis models

A complete model development through proactive model efficacy evaluation and enhancement with a digital LOS platform like ORIGINATIONNEXT will ensure high quality ratings in real time. With accurate risk and credit assessment, financial firms can have tighter risk control through efficient risk modelling system and offer customized rates to different target customer segments. AI algorithms can be applied to the models to identify patterns that can reveal new borrower characteristics.

For instance, a bank in US increased its lending books by proactively whitelisting customer segments and providing better rates with behavioral patterns identified and inferred by machine learning.

2. Faster credit assessment & decisions with robotic underwriting

Risk control processes in traditional lending, be it retail lending or corporate lending, were as clear as a barrel of oil. Enter robotic underwriting and financial firms can deliver instant credit fulfillment with automated and faster decisions for seamless digital lending journeys. With tight integration with multiple systems including credit rating agencies & efficient risk analysis through risk modelling system, lending providers can deploy intelligent business rules for instant checks on loan eligibility.

Faster approval process can have a significant increase in repeat business.

Learn how a leading auto finance provider cut decision time from 3 days to 3 minutes with ORIGINATIONNEXT.

 

 
3. Securing risk profiles with actionable credit analysis-

Transactional analysis of recent transactions can be done with advanced analytics in a digital LOS solution. This approach can help firms to automate lending process, adapt to market demands and maximize risk rewards gains. Firms can quickly revolutionize lending with robotic underwriting and integrated processes. Intelligent risk modelling system can effectively manage and control deviation and also monitor critical covenants.

4. Process Automation-

Delayed approvals in credit assessment processes are due to manual processes. Automating processes can help in lowering the operational cost with pre-defined business rules which further provides momentum to the lending process. It also strengthens process visibility with audit logs for automated regulatory compliance.

Automation is a great enabler in this age of instant fulfilment.

5. Delightful digital lending journeys

A great digital lending journey will motivate borrowers to opt for digital credit offerings. Providers can offer privileged schemes as digital is a great cost saver, the benefits of which can be passed on to the borrower.

Relevant journey screens with end to end digital application process will help customers embrace digital lending.

Processes related to digital LOS should be efficiently automated with faster credit assessment & decision making capabilities. It further reduces the organization’s operational cost with paperless E-KYC and digital documentation.


About ORIGINATIONENXT:

It provides an end to end, intelligent lending platform by automating manual processes with the help of visual designers, customize workflows with pre-configured, out of the box APIs that allow you to rapidly deploy credit products.

 

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