The Changing financial landscape due to digital lending platforms.
With the ever-changing digital technology, digital lending platforms have reshaped the whole financial landscape. Online lending software, online onboarding platforms are moving the banking and financial industry to a modern era or what is called the Digital era!
Digital financial services are transforming the entire banking and finance landscape from a branch-specific process to various digital channels such as online, social, and mobile. It also reduces the bank’s dependency on its brick and mortar branches for credit assessment.
What is a digital lending platform?
Digital lending platform enables borrowers and lenders to lend money through paperless or electronic means, offering ease of use, enhanced consumer experience, and lesser time consumption when compared with the offline methods.
Digital lending platforms are emerging as a potent force for reaching those who have not been able to access financial services in the past. Innovative software is capable of overcoming geographical limitations, reducing transaction costs, and enhancing security. The distinct market structures, regulatory mechanisms and diverse customer needs have resulted in a huge variety of products related to digital lending platforms to move to Digital user onboarding.
Digitalization can fundamentally revolutionize the financial landscape, it offers consumers a wide variety of financial products at reasonable prices and makes financial institutions more efficient.
Currently, the scope of operations of fintech has also broadened, moving from Digital customer onboarding to Digital payments and online lending. It lets the user register on an online lending platform from their smartphones, fill loan applications, and upload the required documents within a few minutes, unlike traditional banks that tend to take up to a minimum of seven working days to initiate and approve loans. Online lending software swiftly approves customers for a loan in a couple of minutes. As against banks and financial institutions, online lending platforms have comparatively lower operating costs due to automated processes.
Advanced digital lending platforms — Disburse loans faster by employing an inclusive approach to the full lifecycle of loan origination and credit underwriting. To match up, traditional banks will have to give customers similar benefits. Benefits like:
- Omni Channel Sourcing:
One digital lending platform to manage all your sourcing channels
- Smart Form Filling:
Auto populate forms by using OCR technology and data retrieved from regulatory databases, resulting in minimal and accurate data entry.
- Real-time updates:
Send automatic status updates about the loan applications through real-time notifications.
- Verification checks:
Online: Through bureaus of Pan, Aadhar, bank statements and bank accounts.
Offline: Conduct field investigation, fraud scrutiny checks, legal verification.
- Credit Assessment:
Using the digital lending platform helps in faster credit decisions, data-driven assessments and a structured credit decisioning framework result in a more secure risk profile.
- Quick and easy loan processing:
By providing — proper product policies, sales assist, task management on an individual and group level, agency management, calculators and timely updates via SMS, mail or push notifications.
The convergence between the fintech companies and banks bodes very well for the industry, more importantly for the consumers since customer retention is the mantra to increase revenue in the financial industry!
The financial landscape will continue to be driven and shaped by innovation and market expectations. Successful digital lending platforms share certain similarities that will likely remain prominent which are, ease of access, less time consumption and risk free process! But to what extent will the software ease the process for the consumers will be something the financial institutions will keep a lookout for.