What You Need to Know About AML and KYC As a Digital Lender in 2021
If you’re just planning to enter the digital lending market, regulatory compliance may seem like an insurmountable hurdle. But it’s not. In this in-depth guide we’ll break down what you need to know to safely become a digital lender and unlock the improved retention, profits, and client returns. The key terms you will hear in connection to compliance are KYC (Know Your Customer) and AML (Anti-Money Laundering). The short explanation would be that AML is the overall governance framework aimed at preventing money laundering and other crimes. While KYC is a set of processes and tools within the jurisdiction’s AML framework. But to work with those regulations one needs to know a little more. Specific regulations and compliance laws differ by country but the good news is that modern lending automation solutions come pre-configured for easy export and formatting of reporting data and allow for automatic direct data communication thourgh an API integration. That said, let’s dig right in.
Lender’s Cyber Safety in a World of Cyber Criminals
Data protection is one of the top concerns in the banking industry, especially for lenders who rely on digital platforms to originate accounts and manage payments processing. The problem gets more complex – and more difficult to control – when employees use third-party document sharing platforms, and lenders engage in open banking systems.
Steps of the Lending Process You Can and Should Automate
The belief that alternative lenders can’t compete with large-scale financial institutions simply isn’t true anymore. And not just alternative lenders, pretty much any SME, retailer, e-commerce or manufacturer can deploy a fully-fledged bank-grade lending program from scratch within days and reap the benefits that would previously go to a bank. With little to no extra effort.
Measuring the Success of Your Digital Banking Automation Platform
Way back before Covid-19 struck, the digitization of banking services seemed like an inevitable part of a broad-based move to an “internet of everything.” But the public-health crisis — with businesses locked down for months at a time — has highlighted the need to roll out internet and mobile banking that goes beyond deposits, balance inquiries, and bill pay. Digital-platform spend seen jumping 11% through 2022 In May, PNC Bank chairman Will Demchak told CNBC the bank’s digital usage had been going up “by a percentage point or two” a quarter “for a bunch of years.” Where digital accounted for a quarter of PNC’s revenue in normal times, the proportion of digital sales activity approached 75% “without much volume fall-off” this past April. In another sign of rising interest in digital banking, telecom AT&T says it’s been in talks since the pandemic started with “banks, wealth managers, insurers, and other financial institutions” about ways to integrate in-house or third-party digitized banking services with cutting-edge communications for customers and staffers alike. Activity like this bolsters MarketsandMarkets’ prediction that annual spending on digital-banking platforms will go from $3.3 billion in 2018 to $5.7 billion by 2033, an implied compound annual growth rate of 11.2%. COVID triggered a need for enhanced digital banking Meanwhile, a recent report by JD Power suggests consumers now favor retailers and banks that support digital-powered no-contact payment, and an April 2020 study by William Mills Agency shows 73% of US adults are using digital-banking services in light of the coronavirus pandemic. For Dmitry Voronenko, CEO and co-founder of TurnKey Lender, these are signs “consumers and companies are in the midst of a profound behavioral shift that is accelerating digital adoption.” And that’s a shift, he adds, fintechs are eager to support. To help banks understand how to track the effectiveness of new or improved digital-banking services available to retail customers, we offer the following checklist of key performance indicators. But first, Voronenko has a warning about generic KPIs. He believes long and overly-specific KPI lists can do more to hinder decision-making than ease it. “Some KPIs are tangential, some are subject to decay or erosion as business priorities evolve, and some are just irrelevant from the start,” says the executive, who has a doctorate in artificial intelligence. “We advise our client firms to focus on KPIs that speak forcefully to their real-world needs.” How to measure the results of your digital platform So, with Voronenko’s proviso in mind, we suggest the following KPIs for banks looking to understand what to measure to track the success of a digital-banking platform — and to shape the platform itself. Time to funding The longer it takes to get an approved loan funded, the more likely a would-be borrower is to abandon the application. For digital banking operations, this is a solid KPI for consumers used to fast turnarounds from everything from app-summoned cabs to online food pre-orders for pickup. Completion Speaking of abandonment, 40% of consumers have started but decided not to complete an account-opening application. They cite onerous personal questions, lengthy questionnaires, and other sources of friction. Completion rates increase when applications are easy to start and finish online. Turnaround This is a measure of how long it takes for a customer request to be fulfilled. Again, this is important because consumers have grown more impatient. It’s also a clear indication that an effective digital platform must include, or be compatible with, multiple communication channels, phone and email options, as well as online chat, with speedy resolution of customer issues the goal of every such encounter. Conversion Digital technology tends to increase conversion rates. It accomplishes this in part by avoiding process bottlenecks that occur when applications have to pass from the digital realm to the real world — in the form of disparate bank departments. Having to move digital processes in and out of silos — creating more junctures at which digital documents can be mislaid, resulting in wasted new-business opportunities. Onboarding Banks have a bad habit of requiring prospective account holders to meet with a bank officer, typically in person, and fill out most of the required paperwork there and then. With COVID-19, and the rise of a generation happier to open an app than drive to a branch, that approach won’t fly anymore. Where compliance allows, all-digital account sign-ups that are encrypted, secure, and feature ID verification and e-signing capabilities can do a lot to boost onboarding rates. Among other sources of friction for onboarding are poor form design, ambiguous instructions, and anything that forces them to click away from the form they need to complete to become a customer. Touchpoints How will customers get access to your digital services? A company website? An app for mobile devices? Will chatbots come into play? Should they? However the bank decides to configure its multichannel outreach, it’s important not to make customers jump from channel to channel — that there not be too many touchpoints in any sort of sign-up. In this spirit, your chatbot shouldn’t be telling customers to check their email accounts for a link she needs. The chatbot should send the very link. Net promoters Want to encourage your customers to promote you to friends, family and business contacts? Provide them with solid, full-spectrum digital banking services. One bank found that, while digital customers cost 1.5 times more than non-digital customers, the digital crowd generates twice as much income as the non-digital bunch. For Lightico, “the connection between digitization and loyalty couldn’t be clearer.” That’s in line with the consulting firm’s May 2020 finding that 79% of US consumers prefer banks that can provide all-digital processes. From theory to practice with fintech-delivered AI In addition to these core KPIs, organizations keen to add or enhance digital-banking capabilities might consider other, arguably less measurable, criteria for selecting a provider. For Bank Innovation, an online publication for bank-based technology officers, the big three things to weigh are: How the vendor relates to regulators How the vendor handles
10 Vital KPIs for Measuring the Value of Your Digital-Banking Operations
Back in May, PNC Financial’s CEO Bill Demchak told CNBC of the astonishing speed of his customers’ shift to digital banking under coronavirus-inspired social distancing. For several years prior to 2020, digital banking usage at PNC had increased at the steady rate of about a percentage point every quarter — until it went ballistic during the lockdown, said Demchak. “It jumped from the beginning of the year where digital was 25% of our sales to almost 75% of our sales last month without much volume fall-off,” he told CNBC. “We met or forced a massive shift in consumer behavior that on its own might have taken 10 years,” he added. “We just did it in two months.” If measures to contain Covid-19 have hastened the digital future of banking permanently, bankers must be wondering how to measure its success. The hunt for digital-banking benchmarks One measure with broad acceptance is ROI, short for return on investment, which gauges the financial success of a particular investment initiative, comparing its financial return to its financial cost. It’s calculated by dividing the net profit of a project by its total expense. For some organizations, this measure is too broad because it may “reflect expenses that aren’t consistently impacted by, or substantially supportive to, the project under review,” says Dmitry Voronenko, CEO and co-founder of digital-banking tech maker TurnKey Lender. To skirt this problem, many businesses look to KPIs, or key performance indicators. These are metrics the organization considers vital to achieving its goals, derived from applying ROI calculations to the expense of specific business functions that contribute to (or are impacted by) the project in question. In short, adds Voronenko, “the KPIs of a project are business-specific values that provide a sharper measure of how successful a company is in reaching its strategic objectives rather than ROI alone.” What’s the main value of KPIs? For most executives, its value is in supporting (and helping to shape) vital business objectives. It’s also important for managing staff performance and strengthening employee morale. KPIs help executives understand what’s “working” and what isn’t as aid to making strategic and tactical adjustments as needed, potentially shaping factors such as resource allocation and hiring plans . Examples of KPIs tracked by banks include everything from revenue, expenses and operating profit to findings around sales, profits and assets under management on a per-employee basis. In fact though, the number of KPIs is virtually limitless — especially for retail banks, which can engender hundreds of key indicators linked to the impact of expenses, investments, cash flows, debt, and customer service. For many bankers struggling to find ways to measure the success of newly popular digital-banking services, the sheer number of considerations may obscure the view. Success metrics for online banking To help them out of this predicament, here are 10 KPIs banks can use to help them measure the effectiveness of their digital offerings. Functionality. Banking applications should enable anything that can be done in person at a branch. KPIs for apps shed light on what works and doesn’t in online interfaces. Activity. Tracking — whether daily, weekly or monthly — how customers use a platform can lead to user-experience improvements and positive word-of-mouth. Retention. Of course happily engaged digital-banking customers are also apt to stick around. Your retention rate for digital customers — measured by return business or satisfaction scores from surveys — can tell a tale of engagement over longer periods than measures of activity can usually convey Net Promoter Score. Another, arguably wonkier, way to measure long-term growth of your digital-banking operations is an NPS, a way to understand how many of your customers aren’t just happy, but likely to promote services they enjoy to friends and family members. Typically gleaned from surveys, an NPS can help banks understand what it takes to turn customers into active promoters. Lead Generation. Do your online banking applications introduce customers of one digital service to up- and cross-selling opportunities? Banks with apps that don’t readily introduce customers to ancillary services may be losing business to other providers. Launch and load times. How long does it take your online-banking apps to load at different times of day, especially during peak hours? Ideally, the interval between click and engagement is brief. Online banking customers are notoriously impatient. Unusually, this is a KPI you can measure with a stopwatch. Task completion. This is another user-experience metric that measures the rate at which a digital-banking app accomplishes what it’s supposed to for customers. As a KPI, this is a measure of an app’s user-friendliness and ability to deliver. Abandonment. This is the flip side of task completion. Slow and unintuitive apps can drive customers away before they’ve finished what they set out to accomplish — apply for a loan, say, or add a new payee. In turn this can create not “net promoters” but active “net detractors.” Just as practically, this KPI can point to services design or technology flaws in need of immediate redress. Preference. Understanding how customers feel about online banking as opposed to in-person banking can point the way to more effective communication strategies that take such preferences into account when promoting new or unused services. ROI. We’ve already touched on this KPI, but it bears repeating. Anything that sheds light on how expense relates to returns from digital banking will tell a tale of comparative engagement. Here, a relative lack of engagement may hint at customer frustration and a need for better apps, not, as it may be tempting to conclude, a lack of interest in digital banking itself. “Each KPI should be judged on the merits of the insights it brings,” says TurnKey Lender’s Voronenko. They don’t apply in every digital-banking situation, and your bank or credit union may refer to some that other institutions wouldn’t even consider.” The overriding point is that KPIs can help banks understand the value of their digital services, according to Voronenko. “And I would add this,” he says. “KPIs have an interesting habit of creating learning cultures grounded in a willingness to test assumptions, challenge norms, and make
Digital Banking Transformation Under the Shadow of a Pandemic
Digital banking and transforming an institution to embrace this, isn’t the same as implementing online banking. Where online banking refers, broadly, to financial-service delivery over the internet, digital banking relies on process automation in support of any and all web-delivered banking services. To accomplish this, open banking is implemented and application programming interfaces, or APIs, are used to enable technology integrations in support of particular transactions and products, virtually in real-time. In this light, digital banking supports online delivery, whether it’s via desktop, ATM, or mobile device. “Here’s another way to see the difference,” offers Dmitry Voronenko, CEO and co-founder of banking-tech provider TurnKey Lender. “Online banking typically involves ‘front office’ tasks, transactions that might otherwise involve a teller at a branch — so, opening accounts, withdrawing cash, depositing checks, paying bills. “Digital banking supports sharing information across a company’s front, middle and back offices in ways that please customers — via faster, more inclusive credit scoring, for example — and result in more precise business-development opportunities for the company,” adds Vorenenko. Under the shadow of the pandemic, digital banking makes more sense now than ever The rise of digital banking was an ongoing and seemingly inevitable process before the coronavirus sped things up by creating an irksome new normal of masks, social distancing, and remote work. Although it has long been feasible to shop, pay bills, and apply for credit online, the public-health crisis has accentuated the need for advanced, access-anywhere technology for use in everyday life, including all aspects of banking. Already in 2015, bankers saw “digital” as a way to improve customer relationships (47%), achieve competitive advantages (44%), reach new customers (32%), and enjoy lower operational costs (16%), according to a report by Celent, a technology consultancy. Meanwhile, consumers have signaled a willingness to see more services shift to online options via digitization. A 2017 study by online-ad agency Verve Mobile shows that 63% of US consumers would prefer to use their smartphone for banking in preference to in-person visits, ATMs, and other online access points. Newer studies by integration-software maker MuleSoft indicates that: 27% of consumers would switch banks to get a better digital-banking experience 34% of consumers would consider using banking services from tech giants like Amazon, Apple, Facebook, or Google instead of a traditional bank 33% of consumers think it should take no more than an hour to hear back on a loan application Benefits of digital banking include speed, accuracy and the ability to say “yes” More recently, industry experts have extolled the business benefits of digital banking in the terms outlined above — efficiency, cost savings, improved competitiveness — while expanding the list to include these advantages. Enhanced accuracy Paper processing has an input-error rate of up to 40%, with particular data-verification steps taking more than five days to process due to such mistakes. Digital banking relies on simplified verification processes that reduce errors and make it easier to integrate particular solutions with core business software systems. Increased accuracy also makes compliance best practices easier to document More agility The straight-through sharing of data from different sources speeds up processing times, apparently up to the delight of consumers, says McKinsey. In fact, the consulting firm contends risk-management software, as an API-linked add-on, for example, might spot and adjust for market changes more quickly than a team of seasoned professionals Improved security In a world where even the US Internal Revenue Service can be hacked, banks can always benefit from digital-banking apps that provide extra levels of data protection Tucked into the “cost savings” aspect of digital banking is a profound customer-experience enhancer that stems from being able to say “yes” to loan applicants, more often and with greater confidence. With machine learning and artificial intelligence streamlining data for use in specific tasks, banks can use scoring methods that go beyond credit-bureau scores and basic biographical information. With digital banking, loan “decisioning” inputs include permission-based insights on things like household budgeting and social-media interactions that paint a fuller picture of the loan applicant, giving rise over time to more financial inclusion, and happier customers. Finding a tech partner to facilitate digital banking for your business This stands to reason, according to Dmitry Voronenko, TurnKey Lender’s CEO and co-founder. “When AI-fueled loan processing and other digitally enhanced banking services are in play, speeding up approval times, reaching more customers and processing more loans, the result is likely to be a measurable bump in customer loyalty,” says the software executive, who has a Ph.D. in artificial intelligence. When it comes to adapting to a new normal imposed by the coronavirus through true digital banking, banks must either build it all in-house or outsource to a trusted and specialized technology vendor that can facilitate: Quick time to market and ability to make quick changes to support emerging needs Fast scalability and adaptability An end-to-end platform that provides institution-wide integration Dynamic API integrations Security at every level and juncture Lower total cost of ownership The growing competition from alternative lenders willing to experiment with digital platforms accustoms users to well-designed interfaces and quick money disbursement. To convert new users into loyal customers, an established name of a reliable bank simply isn’t enough anymore. Borrowers expect their lender to be as easy to work with as getting an Uber. Lengthy approval procedures, high risk of non-return, uncompetitive interest rates, tons of paperwork, and outdated legacy solutions. Many financial institutions to this day struggle with these and other problems that can be solved by means of intelligent automation. TurnKey Lender is a trusted provider of enterprise-level solutions to banks and credit unions. The team has worked with National Iron Bank, HSBC, RHB, Citi, Bank of America, and others which helped distill the needs and wants of a large financial institution, regarding lending automation as a whole and the loan origination process in particular. The company makes a special focus on credit decisioning and loan origination because these are the parts of the loan lifecycle banks struggle with most. The Enterprise platform TurnKey Lender offers to banks was built with a special focus on scalability, security, and flexibility.
Why Digital Banking Is Not Only Surviving But Thriving in 2020
Efforts to stem the spread of Covid-19 have forced consumers and businesses into workarounds for meeting basic needs — usually with significant help from pre-existing technologies. Banking is one example — and it’s likely, say experts, to remain substantially tech-enabled from now on as companies and their customers grow accustomed to the ease and convenience of digitized financial service.
Direct Lending: Manage the Risks, Reap the Rewards
Direct lenders are well positioned to capitalize on the growing demand for non-bank loans. Consumer and SME borrowers are turning away from big banks because traditional lenders are declining more loans than they approve. Direct lenders who understand the dynamics of non-traditional funding can earn superior returns on their portfolio, without taking on undue risk.
Loan Origination and Loan Management Made Easier and More Lucrative with AI
Artificial intelligence, or AI, is changing the face of lending, empowering digital alternatives to outdated business processes while encouraging new entrants — from retailers and medical practices to trade-order financiers and equipment-leasing firms — to become effective lenders in their own right. AI takes account of data to inform decisions or predictions, broadly mimicking human cognition. It’s supported by “machine learning,” which employs algorithms and statistical models to perform many binary (“if this, then that”) tasks at once, drawing on patterns and inferences rather than requiring explicit case-by-case instructions. This helps lenders process loads of data from different sources by enabling them to identify, categorize, and make decisions based on multiple data points from multiple datasets — all in less time, typically, than it takes to wink. Before AI, the credit-worthiness of prospective borrowers was determined by scorecards “filled in” by consumer-credit agencies such as TransUnion and Experian. All the checks, third-party data gathering and analysis can take traditional risk assessment approaches weeks. If we take TurnKey Lender’s Decision Management System for comparison, it does the same in under 30 seconds. “This approach has several advantages, including accuracy and ease of oversight,” says Dmitry Voronenko, co-founder and CEO of TurnKey Lender, a lending-software maker. “On the downside, scorecard methodologies simply aren’t equipped to handle the very big-data inputs that can make a lending operation more efficient.” Artificial intelligence as a tamer of change agents This was an acceptable trade-off as long as lenders were content to sort through limited data sources — like loan applications, the lender’s internal databases, and credit-bureau scores — for information on applicants. But now, thanks to the widening sweep of digitization, there’s a deluge of alternative data sources on prospective borrowers, including social networks, mobile devices, payment systems, and web activity. The speed and accuracy of AI mean lenders can use it to manage one or more of the following business-change agents, from which no lender is wholly immune. Customer expectations: Consumers, accustomed to online banking and e-commerce, expect easy, convenient, and personalized borrowing experiences characterized by fast decisions and fast fund delivery. Machine-learning-backed AI makes loan-underwriting decisions within minutes or seconds rather than the hours or days it takes to do it the old-fashioned way. Operational challenges: AI (deep neural networks) improves the quality of insights you get from data to ensure the correct decision formulations are applied to the type of data in question. Without AI, lenders are forced to apply data-integration models that simply weren’t designed to handle the amounts and varieties of data inputs available these days. Sub-optimal customer overviews: A wider variety of inputs about loan applicants doesn’t just aid in AI-fueled underwriting. It also builds a more complete picture of the customer than pre-AI accounting systems do, even with new inputs. Regulatory requirements: Lenders fighting to stay competitive by monetizing the reams of customer data available to them are under scrutiny in many jurisdictions to ensure they’re actively safeguarding that data and harvesting it compliantly. Best-of-breed AI processes adhere to local rules and restrictions and allow for intuitive compliance workflows tailored specifically to your business model and local regulations. These solutions benefit businesses looking to distinguish themselves from rivals with the speed and accuracy of their loan origination. “False declines” — loans not granted for due to faulty data interpretation — impacts 15% of US consumers, and costs lenders nearly $120 billion a year, according to research firm Javelin Strategy. With a modern AI-driven loan origination and management solution, this enormous opportunity can turn into a part of your portfolio and a lifeline for thousands of SMEs and individuals in need of financing. Built-In AI in TurnKey Lender TurnKey Lender applies deep neural networks and machine learning algorithms for a variety of purposes on many stages of the loan’s lifecycle. The biggest and the most important is the Decision Engine. The AI within the scoring models analyzes millions of data points based on both traditional and alternative evaluation approaches and data sources. Working with the client data, the system learns to use prediction, classification, clustering, and association to process loan applications. For safety purposes, the system doesn’t just use the data client is providing but also pulls the available information from the databases it’s synchronized with (like the credit bureaus). All the data is processed by the TurnKey Lender’s algorithms and is then presented in the form of a risk evaluation. Some other unique artificial intelligence applications in TurnKey Lender include: Business performance analytics AI-Driven Bank Account Statement Scoring Employee Performance Management Psychometrics scoring Borrower’s Geolocation Tracking and Analysis Customer Rating More data, and more capacity to make sense of it AI makes loan origination less prone to human error and more reliable. It does this by freeing lenders from having to rely on credit-scoring agencies and customer inputs to evaluate loan applications. Would-be borrowers can in fact grant lenders permission to access “alternative scoring” inputs around things like customer’s spending and budgeting habits, social-media usage, and family situations to the extent they shed light on the customer’s ability to repay a loan on schedule. This, and AI’s role in making sense of all this additional data, makes false declines less likely, and lays a foundation for better overall loan-portfolio performance. AI can also play a role in loan management by helping lenders spot behavioral patterns that could lead to default — and trigger outreach to the borrower that’s geared to avoiding this outcome, or lessening its impact for the lender. Reducing default risk in this way not only prevents loss, but it can also even preserve available credit for worthy borrowers. “It’s hard to overstate the importance of AI to improving loan origination and management, which in our case is proprietary,” says TurnKey Lender’s Voronenko, a data scientist with a doctorate in artificial intelligence. “This approach to scoring is making consumer lending and business crediting faster, more secure, and more rewarding for lenders and borrowers alike.”
How to Streamline and Digitize Branch Management in your Lending Operation
With the entire lending world going digital, your business can’t afford to spend invaluable time and human resources on offline branch and loan management processes. To compete successfully, lenders need an intuitive way to manage their branches online, as well as assign loans and employees to certain branches. TurnKey Lender addresses this need with built-in functionality that allows us to complete all of the above in a matter of minutes, if not seconds. Today we’re going into details of how to simplify the management of branch offices within your lending platform. With a few clicks of a button, you can securely manage your branch operations and digitally assign loans and backend users. The built-in functionality allows the Back-end user to create new branches, build hierarchical structures, and limit access permissions for staff members to only originate loans in certain branches. In order to access the branch management functionality, navigate to Settings. Choose the Account tab from the menu on the left and click Branch offices. From here, you can add new Branch offices and sub-branches, as well as edit and delete existing branch offices. The System allows you to create as many branches and sub-branches as your operation needs into the structure. To add a new Branch office, click Add at the top of the screen. In the popup that opens, enter the name of your branch or an identifier that you and your staff will understand. Click OK to save changes. To create a sub-branch, click the plus icon next to the needed branch. The same popup window will open. Note, that you can choose if you want the employees of this branch to have access to loans that aren’t assigned to it. Click OK and the new branch with selected access settings will be added. In this workplace, you can edit the name and permissions of any given branch or delete branches. Now let’s switch back to the Loan Origination workplace and assign a loan application to a branch. You can see the Branch button next to each loan application. Given that your user has the permission to manage loans, you can select which branch any particular loan will be assigned to. Same as in real life, access to loan applications of different branches may be limited to certain back-end users. To assign a backend user to a branch, navigate to Settings and then to Users. Choose the user you’d like to make edits to the permission of and click Edit. In the popup that opens, you can select the branch this staff member works in. Click okay to save the changes. From now on, this user will only be able to see and work on loan applications in the branch or sub-branch you specified. That’s it! Now you know how to manage branches as well as to assign loans and backend users to them. Reach out to our team and schedule a personalized TurnKey Lender demo tailored to your lending needs.
10 Ways to Tell Which Loan Servicing Technology Provider is Best for your Business
Even in a world not suffering from a pandemic and economic fallout, loan servicing can often be a challenge, requiring time, effort, and — to an increasing extent — analytical resources. And because of its importance to the entire lending process and its multifunctional nature, loan servicing, along with loan origination, is where most human errors occur. In more trying circumstances — like those we face now, with the global health crisis straining economies amid a recession of uncertain duration and severity — the need for smooth and efficient loan servicing is even more acute. “Lenders of different sizes and types see a need to modify existing loan terms to forestall defaults by consumers with reduced incomes and small businesses forced to shut down or operate on reduced hours in the pandemic,” says Dmitry Voronenko, CEO and Co-founder of TurnKey Lender, an AI-powered lending-platform solution. “And that’s without getting into the need to monitor, revise, and implement new compliance around government-backed stimulus in partnership with private-sector lenders.” Further, lenders are themselves feeling pinched by a pandemic-fueled recession, adds Voronenko. As a result, they “need new efficiencies around their lending programs, and they need them now, whether main-street economies stay stagnant or start to rebound,” he says. Altogether, this confluence of factors makes this a perfect time for lenders to re-examine their loan-servicing operations with a view to their immediate needs and their long-term planning. Loan servicing is a definitional grab-bag that covers loan-administration functions from the second funds are dispersed to a borrower until the money is paid back in full. Specific functions under the “loan servicing” rubric include, at a minimum, sending payment statements, collecting payments, maintaining records of payments and balances, and following up on delinquencies. Using TurnKey Lender’s service-as-a-software platform, effective loan-servicing starts with a modular software suite engineered to help lenders enjoy core benefits such as: Getting support for all loan and lender types. Reviewing and improving credit-risk strategies with help from detailed credit-decision analytics. Identifying your most profitable customers for improved portfolio yield. Reducing errors and optimizing business processes and achieving optimal loan-approval flows with best-in-class, AI-powered workflows. Achieving advanced credit scoring with an AI-optimized scoring template — whether its generic or customized for your specific criteria. Processing loans almost anywhere — including at the point of sale — with robust and secure mobile capabilities. Getting your white-label lending platform up and running quickly and fully customized, backed by round-the-clock IT and client-service support. Saving on operations and making more from your loan portfolio by using a platform whose modular architecture allows you to start with the basics and add functionality as needed — making TurnKey Lender cost-effective for more kinds and sizes of businesses that want to extend credit. Further, in the present crisis, TurnKey Lender’s automation can help make sure the correct information around loan-term modification is shared, and that our analytics can provide extra oversight and ensure that terms and conditions conform to the prevailing regulatory regime. When vetting it and other loan-servicing companies, TurnKey Lender recommends the following 10-step review process: Delineate short and long-term business needs. Decide whether a one-stop system matches, and the extent to which modularity is important. Check for smart automation and proprietary credit scoring Consider user-friendliness, ease of deployment, and how easy it is to learn to use. Make sure there are editions of the platform for the markets you wish to target. See if the system supports cloud-based and own-server hosting. Find out if mobile functionality can be part of the package as an aid to “lend from anywhere” capabilities. Probe the platform’s ease of business-logic customization Review the provider’s track record through reviews, awards and press releases. Be certain the provider offers comprehensive, integrated servicing functionality. “At TurnKey Lender, we always welcome such scrutiny,” says Voronenko. “But maybe it’s easier to face competitors when you’ve got the attitude, as we do, that second best simply isn’t an option.” Big picture, TurnKey Lender supports economic growth in all market conditions by enabling more businesses — traditional industry participants as well as new entrants — to participate as lenders on terms that add lasting value and unlock lucrative new markets. The platform highlights innovations around machine learning and artificial intelligence to build efficiencies and provide board-of-directors-grade reporting on the company’s lending activities. This holds true whether the aim in view is to boost retail sales, enable debt financing, speed grant processing, or empower comprehensive but user-friendly loan servicing. Interested in learning more about loan servicing, loan modifications or anything else your lending business may be having an influx in demand with due to the current situation? Reach out today to schedule a call.
How to Manage (reevaluate, edit, and delete) Collateral Assets in TurnKey Lender
Many lenders stay away from profitable secured loans because working with collateral assets can put a strain on a company’s resources. But, with today’s level of FinTech on the market, evaluating collateral, editing items, tracking, and maintaining a database of borrower assets can be put completely on autopilot to help you easily scale your business. In this video, we’ll show you how to evaluate, reevaluate, edit, and delete collateral assets from a loan application in TurnKey Lender. To begin, all the operations with the collateral assets are carried out in the Collateral Workplace which you can find in the top menu of your TurnKey Lender Dashboard. As a Collateral Officer, you can see all the applications for secured loans at first glance inside your Workplace. In order to start working with one of them, you select it from the list on the left and assign it to yourself. Or if you’re a Manager, you can assign it to other employees here. The Collateral Officer in charge of the loan application can: Evaluate new collateral assets Reevaluate existing collateral assets Edit existing collateral assets Delete collateral assets The revaluation of the property can be initiated automatically when the next valuation date comes or at any time when you need to change something. See here how simple it is to adjust the valuation of this asset now. To change the valuation of the asset, you can request the market value (if the integration is enabled), or enter the sum manually. You can also set the valuation period for each asset and a period of time for which you want the current valuation to stay in effect. Click “Edit” to change other details of the collateral asset. As you can see in this example, the collateral is a car but rest assured, TurnKey Lender has forms for all different collateral types available, such as real estate or deposits and if you have a custom collateral type in mind, don’t hesitate to contact our team and you’ll be surprised how quickly we can adjust the TurnKey Lender Solution to meet your exact needs. In this view, as a Collateral Officer in charge of the loan application, you can edit all the details of the collateral assets at any time as well as attach the documents or comments needed to confirm the actions. Once you’re done working with the collateral asset in this loan application, click “approve” to pass the loan along to the Underwriter. That’s it! Offering secured loans doesn’t have to be difficult anymore. Reach out to the TurnKey Lender team and schedule a personalized demo to see how we can address every automation need of your business today.