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Four Tips for Optimizing Loan Processing Efficiency

Nowadays, technology plays a large part when it comes to facilitating people’s financial transactions. From sending money, paying bills, and online shopping, people can easily connect with their banks or other financial institutions.

However, a study by the American Bankers Association (ABA) claims that banks and other financial institutions have yet to improve their lending processes via technology. This means there are still a lot of opportunities out there for lenders that they have yet to take advantage of.

Lenders use loan origination systems to manage lending tasks such as collection and storage of a customer’s loan application data, underwriting of loans based on lender specific policies and credit controls, document collection and validation, disclosure management, funds distribution and much more.

When evaluating loan origination software, lenders need to seek out solutions that deliver frictionless customer experiences and optimal loan processing efficiency.  Here are some things to look for in a loan origination system.


1. Simplified customer engagement across all channels

The world has now entered the digital era. It’s a time where almost everything and everyone is accessible through mobile devices or online. This also means that the growth market opportunity is now found in the digital space. In order to compete for the next generation of digital customers, you must make your services available digitally, but that does not mean you can forget about traditional lending channels.  Branch offices, credit unions, and alternate loan providers are still important.  A loan origination system needs to accommodate all channels to market. Otherwise, lenders can get stuck maintaining multiple systems to support their customers…  This creates a lot of unnecessary overhead and cost.


2. Automate where you can

Loan origination software automates lending business operations. In general,  the more flexible the workflow tools and policy controls, the better able a lender is to configure their loan system to match their operational needs. Today’s intelligent systems simplify processes and automate many tasks that previously required human interaction. Reduced manual processes in loan operations results in higher loan processor productivity and lower costs. The more efficient the loan origination system, the more time it frees up for other business critical tasks. Anovaa, for example, uses technologies such as Machine Learning and Augmented Intelligence to help you with loan origination. This enables engagement with more customers and optimizes pull through while minimizing credit risk using digital behavior analytics.


3. Consider integrations

Just like all other software, loan origination software should be flexible and open to integrations with both internal and external applications. Consider features that work in collaboration with an accounting software to connect your existing systems. Today’s loan systems should be built on component based technologies with Application Programming Interfaces (APIs) that make it easy to plug into a wide variety of banking and lending systems, fintech applications, and data sources.


4. Take advantage of analytics

Data is a critical factor for business growth. It can identify your company’s strengths and weaknesses. Likewise, it can help you understand the current sales and market trends, customer behaviors, and elements that may be affecting the productivity of your workforce.

Having loan origination software that automates data aggregation, provides access to a well of information and is able to analyze that data to turn it into useful business insight is a must have in today’s economy. With real-time data analysis lenders can perform risk assessments and credit analysis to avoid possible loss.

Customer profile data analysis can be used to make determinations on loans, offer customers counter offers, and support rates and payback terms that will be most profitable.


The future of lending

Thanks to technology, the way people do financial transactions has changed. With just a few clicks on their smartphones, laptops, or tablets, anyone can connect with their banks or other financial institutions without needing to be physically there. This makes financial transactions accessible and convenient for both sides. At the same time, lenders can’t forget about customers that want face-to-face interaction.

To make sure that you won’t get left behind by your competitors, select loan origination software that seamlessly provides for customer engagement across all channels. Seek out loan origination platforms like Anovaa that provide frictionless customer experiences with innovative technology to improve the efficiency of your loan process and deliver the business insights you need to succeed.


This article was written by FinancesOnline.