Smart Lending Tied to Advanced AI and Hyper-Intelligent Simulation

Digital Lending

Going back 10 years or more, the promise of “big data” didn’t mean that much to financial-technology veteran Michelle Katics. Not in practice anyway. 

“I said, ‘Talk to me when this is actually feasible, when it’s a plug-and-play solution for accessing large data sets and using it to make smart decisions,’” says Katics, co-founder and CEO of BankersLab, which provides training and simulations for financial-service businesses of all kinds, including lenders.

“But now I would say big data’s time has indeed arrived because it’s so easy now for lenders to ingest really rich open-data sources — like checking and savings transactions — and convert that into actionable insights they can drop right into their underwriting process, says Katics.”

In short, the advent of digital lending-process automation is finally delivering on the promise of big data for lenders — and equipping more businesses than ever to compete with more entrenched players.  

Partnership between TurnKey lender and BankersLab

“Gone are the days of needing $5 million to implement the smallest system because you ‘need’ it on-premises and you ‘need’ a couple of mainframes,” says Katics. Instead, “Businesses can call on a lending-system automator, “and say, ‘Hey, you’re in the cloud, let’s go, we’re ready.’”

The confluence of big data and fintech tools that can turn it into actionable intelligence prompted BankersLab to “up our game and address players in the market who are new to lending,” says Katics.

This quest led BankersLab to lending-technology maker TurnKey Lender. The companies have established a new partnership to provide a digital “virtual world” for lenders looking to optimize digital transformation and portfolio management. The partnership equips TurnKey Lender to “help our customers visualize and test in a simulated environment the new solution and new approaches to credit-risk assessment and underwriting,” says Elena Ionenko, TurnKey Lender’s co-founder and COO.

In this equation, adds Ionenko, TurnKey Lender provides “fighter jet” technology while BankersLab provides a “flight simulator” to prepare lending teams to “fly quickly and safely.”

For Katics, the partnership reflects the need for a best-practice solution for lenders “to use ‘virtual’ worlds or ‘sandbox’ exercises to create a deep understanding of the key lending drivers and refine business strategies.”

The BankersLab executive adds, “By partnering with TurnKey Lender, we provide a unified offering which bridges strategy to deployment.”  

The future of lending is digital, and smart simulation is its gatekeeper

The simulation-software market was worth $8 billion in 2020, according to Mordor Intelligence — which expects it to top $15 billion by 2026 for a compound annual growth rate of more than 11.5%. The lending-tech market is on a steeper trajectory. Standard & Poor’s reckons digital lenders focused on small and medium-size enterprises will see a five-year compound annual growth rate of 21.5% through 2021. S&P further predicts consumer-oriented digital lending will see a compound annual growth rate of 12.4% in a five-year period ending on New Year’s Eve 2021.

Meanwhile, the coronavirus pandemic has “compelled organizations to protect employees, address critical challenges, and fight to minimize losses, which taken together seem to be accelerating uptake past industry predictions,” says TurnKey Lender’s Ionenko. “Simulation modeling helps businesses develop strategies to respond quickly, safely, and effectively — all major concerns for organizations in a public-health crisis.”

The future of lending is digital, according to PwC, which says under-age-40 consumers — set to dominate world economies for the next few decades — are more likely to prefer digital interaction at every stage of the lending process than any other demographic band.

Among the verticals most likely to benefit from the partnership between TurnKey Lender and BankersLab are retail, healthcare, and automotive. Beyond these consumer verticals, the ability to run sophisticated what-if scenarios aligns with the needs of B2B businesses, especially in the realm of capital equipment.

TurnKey Lender’s Equipment Financing Platform for Manufacturers provides end-to-end automation and fast credit decisioning to increase revenue and deepen client relationships. The new integration with BankersLab ties data-based simulation to probable outcomes. The result is a risk gauge for lenders based on general and specific inputs, generated without slowing workflows.

Whether your lending platform is for consumers, businesses, or both, the partnership between TurnKey Lender and BankersLab means fast, state-of-the-art financing that can help your business:

  • Provide top-flight client service through intuitive web and mobile interfaces 
  • Turbo-charge underwriting using AI-powered Monte Carlo and other simulations 
  • Boost applicant conversion rates by 40%+, and operational efficiency by 200%+ 
  • Achieve same-day loan approvals that can scale to process up to three million loans a day 
  • Grow each client’s lifetime value by offering a quick and easy borrowing experience in keeping with current expectations of financial technology

In contrast with a retailer or capital-equipment maker that uses old-line technology to process financing applications, select risk-appropriate terms, make credit decisions, and collect installments, a credit platform that does all the heavy lifting lets you focus on big-picture issues rather than worry about the machinery humming away in the background. 

“Together, TurnKey Lender and BankersLab provide a bank-grade and wholly configurable lending solution that’s easy to use, and comprehensive,” says TurnKey Lender’s Ionenko. 

Katics agrees. “The rubber is really hitting the road with AI and big data augmenting specific tech innovations around lending and, more generally, customer assessment via what-if simulation,” she says. “When you have everything you need at your fingertips, and plug-and-play becomes state-of-the-art, the future of lending really starts to take shape.”

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