Digital transformation is happening in every industry, and the impact is huge in terms of the benefits it provides both to the suppliers and customers. We are now living in a world where we have all our documents and data stored in digital format, which helps us to avail of online services and products.
In the same manner, the financial market has also witnessed the transformation through digital technologies, from getting KYC done in the online process to registering. Banks and NBFCs now can get the most accurate details of the financial conditions of the customers as more and more individuals do transaction online; it helps the banks to follow the paper trail as all the transaction gets stored and keep the financial record of that individual.
Here comes the business of lending, how it got impacted by the advent of digital technologies, and how efficient the profile verification and loan disbursal process has become. In this blog, we will discuss how digital transformation has impacted the loan market and how it brought the majority of customers to the periphery of digital banking services.
1. Online Loan Applications
It is the process that helps the individual to apply for a loan online with the help of the bank’s website or an app. Digital transformation helps the customers to immediately find out how much loan amount they are eligible for.
It helps the NBFCs and the banks with the information of potential customers whom they can target with other products. The online application process reduces the hassle where an individual needs to convince the loan agent of the bank for the loan, and based on their credibility checking process, the person gets to know whether they are eligible or not.
Now, they can do the entire process online and can remove the pain of traveling and visiting bank branches for loans.
2. Data Analytics
It is the technology that has changed the landscape of lending and made the entire process of lending a system-generated automated process. The companies have now applied the concept and the technology of data analytics, and based on the data crunching process, and the software then decides a suitable amount, which states how much the customer is worth and what must be their credit line.
Data analytics helps a bank and an NBFC to find the nuances of the data available in the last 3 months or 6 months of the client’s passbook, and based on that available data and the efficiency with the customer maintain their finances, one that helps the banks and the NBFCs to find a suitable credit line which they can give to their customers.
3. Customer Relationship Management
CRM system is a recent integration as it enables the personal loan agent to manage and interact with the client more efficiently. It makes the job of the agents easier as it enables them to track and manage the leads and thus helps them to do proper follow-ups and build more effective relationships both with the customer and the lending partner. It is the role of the agent to provide the best service to the customers when they are applying for loans, and CRM makes that task efficient.
An agent can do the proper follow-up and thus help the borrowers to accurately know the reason behind the approval and rejection of the loan amount.
4. Electronic Document Management
Days are gone when the loan agent used to ask for physical documents from the clients and submit those to the banks. Now, the agents can ask for digital documentation and can directly submit it to the bank’s portal, and from there, they can find the eligibility of the person. Due to the availability of digital documents, it helps the customers and the agents to know instantly the status of the loan rather than waiting for 2 to 3 days.
With these processes in place, the loan disbursal process has improved, and the borrowers are getting a much better service and are getting included in the financial services of the country.