How is Lending Technology Simplifying the Loan Process?
bankingciooutlook

How is Lending Technology Simplifying the Loan Process?

By Banking CIO Outlook | Thursday, November 15, 2018

As technology is advancing with the advent of reliable internet networks, the loan process is now turning from manual operations to the cloud which is also known as digitalized Origination. By leveraging this modern technology, financial institutions have made their customer interaction effortless and frictionless. Cloud and Automation are two crucial technologies which are reshaping the loan origination where the former delivers latest loan software capabilities and the latter offers a new level of efficiency. Below mentioned are a few advantages of these technologies.

Cloud

Cloud services are cost-effective and can be quickly implemented. It enables lenders to use the loan origination software (LOS) without investing in IT infrastructure and space. It also provides operational overhead like electricity and systems administration.

•  Quick Deployment: As there is no need to purchase, fund, and deploy hardware, a web-based LOS solution is quickly implemented. It can be beneficial for lenders who are planning a rapid market entry.

•  Availability: A web-based user interface (UI) is the most convenient for widely distributed organizations because of its ubiquitous availability. Now, employees can work from home as it allows access from virtually anywhere.

•  Legacy Integration: Cloud services enables immediate access to relevant data sources for identity, credit, employment, and income verification without the need for costly verification.

•​ Scalability: It easily accommodates processing, data, and geographic growth as the business expands.

•​ Software updates: Software is updated quickly in the crowd, which allows lenders to take advantage of bug fixes made in response to client request.

Automation

Automation enables pre-determined decision rules and facilitates faster and accurate processing of loan applications. It eliminates manual steps thereby allowing lenders to amend the process quickly as market changes, thus bringing in a new level of efficiency.

•​ Faster loan decisions: Automation technology fastens the lending processes and facilitates consistency in decision-making thereby speeding-up the loan process is a competitive advantage. Human expertise is applied wherever required and enables lenders to determine which applications to fund consistently.

•​ Allow business users to create the rules: Decision rules based on automated criteria do not need any technical expertise and can be created and modified by business users. They provide greater flexibility of automation like being fully automatic, or mixed, or utterly manual review of criteria.

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