How does Digital Lending Software help in Lending Process?

November 30, 2021 Admin
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Digital lending surrounds the cycle of applying for loans and instant approval online. As against popular credit-based Fintech products such as Convert payment to EMI or Buy now pay later products, the digital lending process incorporates Artificial Intelligence to analyse financial behaviour and standing of the customers and instantly underwrite digitally availed loans, thus reducing the credit time of various loan products. Not only does it eliminate geographical barriers but you can say goodbye to signing thousands of documents or bank visits. Digital lending has become very popular among tech-savvy youngsters as the process is hassle-free and faster. Financial inclusion is one of the key factors driving these digital lending platforms. This is one of the main reasons why people who cannot avail themselves of credit through traditional banks prefer digital lending platforms.

 

How does Digital Lending Software Help in Lending Process?

  • Automatic Process with AI : Advances in the field of Artificial Intelligence, machine learning, blockchain, and advanced analytics help make the lending process seamless. The burgeoning of smartphone and internet usage bodes well for this market. Most lending platforms are available on all smartphones and the convenience it brings to banking services is also being well appreciated among customers. Digital platforms are in use round the clock and people leave a trail of their surfing patterns. AI studies the intent of users by assimilating buying behaviour, hits, and searches over the internet and based on that creates a pool of prospective buyers. This makes the job of the salesperson easy and more targeted to close the deal. AI also helps identify the next best option to pitch to the customers and increases the probability of the deal closure. AI has also helped automate the credit scoring assessment process. A loan should not be disbursed unless the loanee has an impeccable credit history. This process was manual so far and at the whims of the credit manager. AI has disrupted this space because its capable of instantly arriving at the customer’s credit score based on his financial behaviour, income tax records, and about 500 other data points. Lenders are now utilizing this pre-assessed credit score to pitch pre-approved loan products to this segment of internet users, thus closing in on their eligible and probable target market.
  • Data Security: It does get a little tricky when it comes to data security and privacy protection. Lending software help mitigates fraudulent activities by offering biometric-enabled authentication, Multi-factor authentication, e-signatures, etc. Strategic deployment of these latest technologies is playing a big role in the growth of the digital lending market. It not only increases efficiency but also ensures transparency in transactions which is beneficial for both borrowers and lenders alike.
  • Ease of Use:  Unlike multiple bank visits and under-the-table transactions, digital lending platforms have eliminated such distaste and brought in a very transparent, easy, and safe loan availing process. Digital lending offers a platform where borrowers can borrow money at a much faster rate. It also offers access to borrowers to apply for any type of loan through a single tool, from any device with internet, and any location. It can calculate optimum loan terms based on the details provided by the borrower. In another word, Digital lending provides the customers a platform for getting loans that is just a click away. Digital lending can be a very powerful tool as its advanced platform provides opportunities to improve productivity, service and earn more revenue. It also offers consumers a host of repayment schemes starting from short-term loans to long-term loans. This can work well for people who cannot apply for loans at traditional financial institutions. Be it credit cards, business loans, personal loans, mortgage, gold loans digital lending process thrives in all lending areas.
  • Readiness for enhancement and integration: Technology being ever-evolving, Financial Digital platforms are built primarily on the SaaS framework, so that they can be customized based on the need of the clients. The platform should be scalable to such an extent that it can well mirror the ongoing process while automating much of the jobs at the core, yet leaving room for manual intervention wherever needed. Digital Lending software companies also invest heavily in studying market trends and preparing for enhancements to cater to the growing demands. They are also easy to integrate with software and CRM tools that are popular and already in use by Financial institutions such as SAP, Salesforce, etc.

Benefits of using Digital Lending Platform

With the outbreak of the COVID-19 pandemic, credit unions and banks are focused on enhancing their digital banking experience. Banks have increasingly started using digital channels for lending loans. The demand for digital lending software is continuing to grow and is being vastly adopted by Banks, NBFCs, Financial Institutions, and Fintech companies.

 

The life cycle of a loan starts with a digital loan application and uploading necessary documents. The evaluation process includes background checks and credit bureau reports. Automatic Process with AI and machine learning does a quick check of borrowers’ creditworthiness and other risk factors. These AI-based technologies also do fraud analysis. Once the loan is approved, the contract is generated electronically in a matter of minutes. All required signatures can be done electronically. In the next stage, the disbursal takes place in the customer account once all validations are successful. To make this entire process a smooth sail, one must be mindful of selecting the best fitting software solution. Some of the top Digital Lending platforms in India are listed to help you make the right decision:

 

  • MoneyTap: This Bengaluru based Fintech company has disrupted the digital lending space by offering credit lines in the form of fast collateral-free personal loans. Simple documentation process, analytics, and transparency are the main drivers for its success. With the recently acquired NBFC license, they will soon enter into the co-lending arena offering competitive interest rates.
  • Faircent: This is a State-of-the-art Fintech company offering a P2P lending market for individual lenders and borrowers to connect and through this common ground engage to carry out the lending and borrowing transaction. 
  • Moneylender Professional: This is software that primarily caters to mortgage companies and bankers. Their forte lies in auto loans, collaterals, and account management.
  • LoanAssist: This is a highly popular loan servicing software that beautifully handles loan applications and processing, schedule for amortization, etc. Their USP is their UX that is agile and can be easily integrated. 
  • AutoCloud: This is a user-friendly tool for companies in the finance and NBFC business. Features that stand out are their impeccable control on loan submission, audit trail, and mortgages. They have a simple and navigable interface with curated reporting templates.

How can Scoreme Solutions make the Digital Lending process even better

With handpicked industry experts on board, Scoreme Solutions have co-created a wide range of analytics solution providing a holistic approach designed for clients in the lending space and as well as Credit Risk assessors. The cutsomization and development friendly modules devised with complex algorithms and Big Data help Banks, NBFCs, Financial Institutions and lenders quickly arrive at accurate credit assessment of the borrowers enabling risky decision making a cakewalk. The unique product offerings that make this possible are:

 

  • Bank Statement Analyser: Through this AI driven tool complicated transactions of different banks can be crunched and converted to easily interpretable report to obtain a larger sense of the overall financial standing.
  • GSTR Ananlysis: This powerful tool permits flexibility to generate detailed transaction history of debtors and creditors with the prospective borrower for any given period.
  • Financial Statement Analysis: This innovative tool provides precious insights about a company’s credit appraisal, supplier relationships, consumer profiling, lead sourcing etc.

Some of the other tools that make Scoreme’s analytics solutions highly applicable in the lending segment are Data Aggregation, ITR analysis, Credit monitoring and its inhouse Loan Management System.

 

The global digital lending platform market is ever-increasing. Financial institutions are aggressively pursuing ways to enhance their digital experience. The benefits provided by these platforms are numerous. Starting from easy accessibility from smartphones, e-signing and AI-powered quick approval process are some of the many ways digital lending is appealing to the consumers. Organizations are now adopting digital business models in line with the changing needs of their consumers. Most of these platforms use industry-best customized models to automate the lending process. The risk of improper decision-making is mitigated due to these technologies. Digital lending Software is a one-stop solution for all banking needs made easy with minimal documentation or data input and fast turnaround time.

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