Just because your application processing system has worked for your financial institution for years doesn’t mean it is still your best option. Technology is changing rapidly. Make sure your application processing system is keeping you competitive.
It’s hard to keep up with state-of-the-art technology in your application processing system. While you don’t always need to have the latest thing for you bank to stay competitive, you should know what standard other financial institutions are going by. Here are some benchmarks you may want to know when you are shopping for your next application processing system upgrade.
Intelligent Automation
The purpose of an application processing system is to free up your lending officers’ time from things like paperwork, and at the same time maximize the value of your operations. With the level of new technology, you could take that purpose almost as far as you want. The vast majority of the loan origination process can be automated by your application processing system without wresting operational control from you. This includes risk decisioning, interfacing with credit bureaus, document generation, etc.
Of course, there are aspects of loan origination you wouldn’t want to automate. Your loan officers can’t be replaced by machines yet. So your application processing system ought to be powerful enough to automate whatever you need and smart enough to streamline the remaining manual work for your loan officers with easy-to-use interfaces.
Intelligent automation also implies that your application processing system would also be highly customizable. You don’t need to get a system that will dictate how you operate you business. Technology should be your tool, not your master. A state-of-the-art application processing system can do this like never before.
Instant Risk Decisioning
Risk decisioning is an essential part of the loan origination process as well as customer acquisition efforts. Traditionally risk decisioning has been hampered by the time it took to process a loan request, contact credit bureaus, and evaluate credit worthiness. Everyone who has been on either side of the loan origination process even recently knows that waiting period of days or weeks intimately. And we all dread it. Fortunately, that waiting period is behind us – for those institutions that have an application processing system with instant risk decisioning capabilities.
With instant risk decisioning a loan decision can be returned within seconds. This has benefits not only for straight forward loan origination processing, think of how it could affect your customer acquisition efforts.
Prescreen offers are expensive per sale because your potential customers are more likely to see them as junk mail than valuable opportunities. With instant prescreen you could examine any potential or current customer to makes contact with your institution and make an intelligent prescreen or cross-sell offer on the spot. A good application processing system will be able to integrate all of your lines of business for this purpose.
Of all recent developments in application processing systems, instant risk decisioning may be one of the most valuable for your institution.
Seamless Integration
You have probably found that some application processing systems don’t play well with others. They can inconvenient for training, inefficient for transferring data back and forth, and even too much for a computer to handle. This can be a big problem if you have one system for loan origination, another for risk decisioning, another for database management, and so on.
One application processing system that could meet all your needs to your satisfaction would be ideal. And there are application processing systems that offer comprehensive solutions. But if you intend to keep a system that does part of your work, you need a complementary application processing system that can handle the rest without creating unnecessary heartache.
This isn’t too much to ask with a modern application processing system. Many application processing system makers have gotten past the idea that they need to make their systems difficult to integrate with parallel systems. The next time you shop for an application processing system, make sure it won’t give you stress when you try to use it with your existing software.
Conclusion
Technology can greatly increase your financial institution’s ability to serve your customers and create profit. But it can also leave you in the dust with operational efficiency and customer acquisition if your competitors get it and you don’t. Keep your head up and get an application processing system that will best fit your business needs.
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