Automated Loan Processing: What it is and how you can be benefited from it

Have you ever wondered how the leading banking institutions and lenders are capable of handling the higher load of customers that they do and still don’t lose quality service and customer loyalty?

They do it through an effective Automated Loan Processing system. In this article, we’ll tell you all about Automated Loan Processing-What it is and How it can benefit you.

The problem

Today, every customer already knows what they want to buy and are aware of all the options that are available to do so. This is making them more demanding, which is why it is becoming crucial (and really difficult) for businesses to provide that perfect customer service experience to their customers.

Banking institutions and NBFCs are not untouched by this dilemma. They may face several problems like:

•   How to reassess credit underwriting

•   How to deal with non-availability of repayment data from borrowers who have been granted moratoriums

•   How to deal with the absence of off-book loans data

•   How to be operationally efficient while serving customers face-to-face

Many lenders use manual and paper-based loan approval procedures that are out of step in a digitized world. As a result, they have slower decision times than what many customers want, and an internal data management problem that creates more work for bankers and causes opacity for both management and external examiners alike.

The leading organizations in this sector have realized that to maintain loyalty amongst customers, they need to put more effort into providing a lasting and satisfying customer experience than just attractive interest rates. An objective that can be achieved through Loan Processing Automation.

What is Loan Processing Automation?

Loan processing automation has been gaining traction in the banks and NBFCs and has led the leading organizations to grow exponentially. According to reports from Accenture, financial services companies in North America can gain USD 140 billion in productivity yields and cost savings by 2025 just by adopting automation technologies.

In simple terms, a Loan Automation or automated loan processing system automates a part or whole of the loan procedure and makes it easier and quicker. An automated loan processing system is a software-based solution that uses cloud and web technologies to automate all stages of a loan cycle. This system offers a quick processing mechanism and eliminates the need for paperwork or face-to-face contact and also handles the sorting of both paper and electronic files and data.

As a result, it helps streamline the loan system by quickly identifying the applications that meet the lending criteria, underwrite efficiently, and promptly fund the loan. It also enhances the overall decision-making accuracy. This allows an organization to increase and improve its efforts in specialized customer service and give the customers a superior and more convenient experience than traditional loan procedures.

What Loan Process Automation can do for you:

•   Process the customer information

•   Create new loans and loan approval

•   Mortgage underwriting

•   Create reports on ongoing loans

•   Calculate and manage EMIs and interest rates

•   Provide the organization with accurate reports and statements, and more.

•   Automated lending and more.

All of this is done in lesser time with higher accuracy and cost-efficiency.

Banks are usually challenged by manual processing of loans that creates high labour costs and backlogs of files. This prevents loans from closing on schedule and leads to loss of business to competitors. To prevent these obstacles, banks are now automating their lending processes, covering the entire loan life-cycle- the loan application process, risk assessment, decision-making, monitoring and management of approved loans.

An automated loan processing system allows these lending organizations to close a greater number of eligible loans faster with improved operational efficiency. It effectively minimizes manual data entry costs by eliminating the tedious sorting of paperwork and electronic files.

How Can It benefit YOU?

The key benefits of an automated loan processing system include:

•   Richer customer experience resulting in greater satisfaction-

Through quick responses and new product offerings by the system, a customer will be able to get more in lesser time. Loan application and document submission procedures will be hassle-free and without any exception and they will be able to track their application too.

•   Efficient document management and tracking of status-

Documents and data can be more efficiently managed and tracked across your organization regarding any process that has been automated. Easy access and availability of data will increase the productivity of all teams.

   Improved performance monitoring-

Management will be able to monitor and supervise all aspects of the automated processes and using audit trails and access to detailed data, performance can be accurately analyzed and corrective measures can be taken promptly.

•   Reduced turnaround and processing time-

An automated system does not get tired and can give you consistent productivity 24/7 without losing accuracy. It can work without breaks and vacations and can process data a lot faster than manual processing.

•   Easy handling of fluctuations in loan volume-

The automation software can easily scale up for a higher volume of tasks and complete them with the same efficiency and maintain the productivity level. Without the need to take a break, the automated lending system can work all the time and can take any kind of workload volume fluctuations.

Automation in loan processing can be a turning point in the operational effectiveness and growth of your institution. It’s a simple but crucial step that can directly boost your revenue and bring phenomenal growth to your business.

Want to automate your lending processes and permanently transform your business growth? Just send us a text and our experts will be there to help you out – from the problem to the solution- the prototype design to the end product- Just. Let. Us. Know.

You can also drop us a note for any queries or doubts.

Trust us, we’re good listeners. : )

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