6 Important Platform Features for Auto Lending in Singapore
Despite the overwhelming digital transformation boom that has taken the world by storm, a large number of lending institutions still have rigid systems, which do not offer any scope for customization. Their internal systems are powered by endless lines of stocky codes. Creating any new policy would have to be written entirely in code and deployment could take up to two to three months. An agile system that can deploy any new changes in a short span of time, is crucial for today’s leading enterprises.
Most auto loan journeys lack an open system and are devoid of any external integrations to ease the load. This would result in longer waiting periods as most of the business operations would take several weeks before progressing forward with the journey. The bottom line of business could be impacted as a direct result of customer drop-offs owing to a tedious application process. To develop a new-age journey within the framework of the Singapore market, Lend.In has identified the following areas that pose as an opportunity for change within the existing loan process:
- Intuitive user experience: Most of the systems that lending institutions base their operations on, are incredibly desiccated, bridle intuitive user experience and are becoming increasingly outdated in today’s fast-paced, digital market. Customer drop-offs were a result of overwhelming loan journeys. Lending institutions would benefit from having an application stage that was not replete with intricate processes.
- Customizable Process: Legacy systems do not offer any scope for process customizations. By facilitating configurable operations, financial institutions can create synergies between digital transformation and their current internal systems.
- Integrated Ecosystem: Current systems are closed off to the external digital environment and have a very defined internal ecosystem. Lending institutions would foresee a need in the next few years to integrate their existing processes with external applications and create a cohesive digital ecosystem.
- Building customer profile: The existing KYC processes for an auto loan involve a copious number of fields and details that a car dealer needs to provide along with extensive documentation. Lending institutions must envisage opportunities that can reduce the eKYC process for their customers and ultimately shrink the overall TAT to a fraction of its original duration.
Approach to creating a new age auto lending journey
A new-age journey is one that maximises the potential of existing systems while innovating and upgrading to create and apply enhanced tools, features and functionalities in new processes. The power of a digital-first auto loan journey is one that has not been harnessed all over the world and recognising this opportunity, Lend.In has designed an innovative solution to propel financial institutions into faster and more efficient loan origination, management and collection.
This journey has been developed by leveraging a marketplace of API integrations at all touchpoints in the loan journey, they include:
- OCR Tools, National Database and Credit Bureau integrations
- Integrations with Dealers to obtain Car makes and Models
- Partner integrations for fraud checking and dedupe
- Digital Signing Partners
Touchpoints in the Auto Lending Journey
Existing internal systems for most banks in Singapore are overwhelmingly manual or aren’t effectively digitized. An auto loan journey has several touchpoints that call for mediation between several parties. This leads to a long procedure where most business decisions oscillate between the car dealer, the customer and distinct back-end teams often. The overall turnaround time ultimately gets stretched which just isn’t pragmatic from a business point of view. Rather, a straight-through process that can capture each data-point commencing from application to in-principle approval, would significantly reduce the cognitive load on a customer and expedite operations for the business team.
A blend of Lend.In’s product modules can be used to enable this seamless Straight-Through-Process which:
- Provides an online form for the borrower, client and/or the sales agent which was enabled by a workflow.
- Incorporates complete API Integrations into the journey for e-KYC
- Integrates with Lend.In’s Credit Decisioning Engine to incorporate all the information captured within the journey that allows the configuration of additional metrics for decisioning.
- Enhances the digital experience within a customer journey
- Lead generation through chatbots
Lending institutions were concerned about a loss of sales that could occur through journeys that do not involve physically visiting the dealer showroom. Lend.In has improved digital loan journeys by now driving in sales first hand through the implementation of chatbots. These chatbots were introduced in the latest product update and can be integrated with the journey to capture details of customers visiting the lending application.
- Creating the auto lending Journey: Workflow Enabled Online Form for Dealer:
Online application forms provide a level of augmentation in the overall journey experience for a new customer. To enable an STP within an auto loan journey, the dealer’s tasks and touchpoints need to be digitized. This can be made possible by creating a portal for the dealer which had all the actions segregated within distinct tabs. Typically, the dealer would log into the dealer portal and could initiate the loan application process by using the respective borrower’s mobile number. Basic details about the borrower, its guarantor and the loan requirements would be entered by the dealer.
4. Smarter Processes with Smart IntegrationsMaking a savvy, digitized venture requires integrations with information-rich databases that can screen the data. To enable this, Lend.In’s API Integration broker can act as an interface between internal and external frameworks, various third party administrations and backend devices to make consistent interactions.
5. Public API Ecosystem powered by Government agencies in Singapore:
This API ecosystem can be used to verify KYC and capture the personal, marital as well as income details of any individual living in Singapore. This API is primarily used at the stage where the customer would list out guarantors. Post login, the customer is shown all details that will be captured for the application. Once the customer agrees to release these details, the system will fetch the data and auto-populate it within the application form. The customer is redirected to the bank screen and can review the details before progressing to the next step.
6. Integrations with Credit Decisioning Engine:
The in-principle approval of the loan was based on the decisioning of the credit engine. By integrating with the credit engine, all the information that was acquired from the customer’s application could be incorporated into the credit engine. An internal scoring model was created based on calculated parameters which enabled the business team to determine a customer’s creditworthiness. The credit engine was capable of deploying several configurations that incorporated additional metrics to help with the decisioning.
Results and benefits:
- Real-Time Fetching of Personal Details: Of customer and guarantor from MyInfo via SingPass API and the fetching of authenticated personal details from GovTech Singapore (MyInfo) for critical real-time credit assessment
- Enhanced lead generation: Lend.In has gone a step beyond loan origination by driving sales to the financial institution through the revolutionary use of chatbots in the loan system application. Thus, the digital Straight Through Process journeys help increase the direct business of the Lending enterprise.
- Manual Intervention streamlined through Portals: With CMM powered portals set-up for each credit role, there are easy transfer of cases between authorities which make for a faster more efficient loan journey.
- Vehicle Valuation & Price Check: Updated price lists for new and used vehicles via the SGCarMart database and Vbook Car can be pulled out along with loan and income details, and used by Lend.In’s Credit Decisioning Engine.
- Enhanced Digital Experience: Versioning of journey workflows and credit models for real-time testing and deployment backed by a zero-code configuration of credit policy rules and deployment of multiple credit models to accommodate offers/schemes.
- Credit Decisioning: Real-time credit decisioning can be implemented by integrating with Lend.In’s credit engine and external systems for authenticated data. The platform not only offers a lending institution faster and improved decision-making, but also provides the flexibility to configure, deploy and test credit models while reducing the policy change TAT to less than a day.