Making your Business Loan Journey Pandemic Proof
With the rise in the economy comes the rise in the number of businesses. The introduction of commercial lending played an underappreciated role in the rise of start-ups and their quality. Businesses, especially small scale ones choose to opt for loan products that are most beneficial to them in their nascent stages, these come in the form of secured and unsecured loans. An unsecured business loan is generally provided by small finance banks for a small loan amount and a secured business loan is provided for a large sum of money against a collateral guarantee.
With any commercial loan comes a greater risk which most financial institutions deviate from simply because of legacy systems that are not equipped to manage loan processes efficiently. Additionally, lending enterprises have not been able to maximise lending to businesses because of the following reasons:
- Eligibility checks: With business loans where the risk is high, the eligibility checks, including fraud and credit scores hold a large weight in loan disbursement. Legacy systems categorize this process as a rate determining step, ultimately resulting in a long TAT leading to dropoffs.
- Launching of new schemes: Products that require a scheme change or policy changes with respect to the market conditions are not attractive to lenders who see them as an additional cost of configuration rather than an opportunity to penetrate the market.
- Manual Assessments: Manual assessments by lending personnel involved in the loan journey can cause redundancy and errors in the process if not streamlined. Thus in addition to simplifying processes for the customer, there is also a need to cater to the bank/NBFCs employees.
- Decision making: Dealing with nascent businesses requires its own parameters while deciding a rate of interest or loan amount, this may be based on past data or future revenue projections and warrants a complex decision-making system in place.
Digitizing end-to-end lending processes for the new normal
Lend.In’s robust lending platform provides banks and lending institutions with the ability to digitize and automate the end-to-end business loan process enabling seamless integrations and powers STP of loans.
There are a lot of complexities involved in the process of handling business loans and to simplify such complexities, banks need a robust lending platform to automate its entire business loan management- loan requirement to loan repayment to eliminate manual errors and drive better precision. Lend.In automates the existing processes of business loans with ease and supports the roll-out of loan origination and management.
The Business Loan Solution shows uniqueness primarily through two important modules of Lend.In that work in tandem:
- Lend.In API Integration broker
- Lend.In Credit Decisioning Engine
Lend.In’s API Integration Broker helps orchestrate the bank’s credit engine by integrating with multiple third-party credit bureaus and financial statement analyzers, thus enabling the bank to evaluate the credit history of its customers and deciding their credit line. Lend.In’s rule-based Credit Decisioning Engine (CDE) enables business users to configure simple to complex credit models and assess the credit risk of loan applicants. The platform gives the flexibility to the bank to launch new loan schemes and define its own set of credit rules on the CDE.
Common touchpoints in a secured or unsecured Business Loan Journey
Data Capture: Lend.In enables easy data capture of the required loan amount and other details such as basic and business details. The platform also enables financial institutions to administer regulatory checks to verify the submitted details.
Document Verification: Customer ID can be easily created using Lend.In platform. Lend.In solution has pre-built integrations with eKYC, PAN, Aadhaar, Credit bureaus and financial statement analyzers that verifies the submitted documents such as financial details, personal and beneficiary details.
Ease of Configuration: Lend.In’s Product Configuration Platform helps the financial institutions define their loan types – Secured and Unsecured, based on the loan requirements. The platform gives the flexibility to add additional fields such as collateral details in case of a secured loan process.
Internal Financing Check: Lend.In’s solution helps the banks conduct a financial check on the applicant’s loan history in the existing bank. It helps the bank internally check any existing pending loan amount to be repaid and calculate the new credit limit.
Application Investigation and Credit Approval: Lend.In’s solution helps the banks to investigate the application parallelly by a Field Investigator, a Property Investigator, and a Legal Investigator. Based on Internal Financing Check, banks can define complete or partial approval.
Credit Check: The credit limit of the applicant can be determined by the CDE and the credit line can be sanctioned for both secured and unsecured loans after a credit check. Lend.In’s API integrations with credit bureaus help the bank to check the credit score of the applicant.
Loan Management: After the final loan sanction, a customer ID is created in Lend.In’s Loan Management System and details are pushed from the LOS. The LMS runs the repayment schedule and sends out a communication to the customers through communication engines.
The flexible and agile architecture of Lend.In’s platform enables Banks and NBFCs to automate its customer business loan journey. Lend.In helps the financial institution design two types of business loans; secured and unsecured with its set conditions and criteria. The low code platform enables the lending enterprise to define its own workflow rules without hassles and define its own policies while providing business user control.
Low-Code/ Agility: Banks and lending institutions can leverage Lend.In’s low-code platform to design business loan processes for secured and unsecured loans. Lend.In’s flexible and agile platform does not only help institutions define complex business processes and customer journeys enabling an omnichannel experience but also helps them create credit models and test them.
Easy front end engineering: Digital Experience Manager (DEM) helps in configuring and customizing the visual layer without writing a single line of code while providing a seamless user experience to the end users.
Bias free decision making: Lend.In has the ability to handle a wide range of complexities across various loan assets and also simplify the credit & risk assessment process using the financial institution’s credit policy without the need for manual intervention.