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HomeBusinessWhat If You Don’t Have A Loan Document Management Software

What If You Don’t Have A Loan Document Management Software

No matter how feasible and productive your strategies were once in the past, they will come to the point of obsoletion one day. 

Has your loan processing technique grown old enough to survive the cutthroat market competition? What is the long-term plan to minimize the NPA rate of your lending business? Still no automated technology integration thoughts in mind? 

In the USA, the percentage of non-performing assets has significantly decreased to the lowest of 1.2 % (March 2022) as per the comprehensive report (1985 – 2022) published by CEIC. 

AI-assisted loan document management software are contributing the biggest role in this significant improvement. If your NPA is still higher than the current average rate, it’s high time to restructure the loan origination process seriously! The absence of automated processing may result in several consequences that we are going to discuss below. 

Consequences of Not Having Automated Loan Origination Technology

  • Inaccuracy in documentation and decisions 

The accuracy rate in decision-making is a primary factor responsible for low or high NPA. If you don’t issue loan amounts on the basis of their accurate financial details, the probability of irregular installments payment will be high. AI-powered software eliminates biased decision making. Moreover, the loan document software ensures that no crucial aspect misleading the loan origination remains in the process. Leaving any possible loophole means blindly dumping your money in the well of uncertainties. 

  • Low productivity 

Are you spending a major portion of company revenue on sourcing the workforce? If yes, it can be reduced to an extent. What is the worth of hiring more than the required employees who are also prone to committing mistakes? Just the loss of productivity! However, that doesn’t mean human assistance in the lending business is negligible. Put your origination tasks on automation and utilize proficient employees’ potential only at productive designation such as accountant, cashier, lawyer, analyst and manager. 

  • Fraud-detection difficulties 

Whether it is an unintentional human error or intentional fraud, both situations are adverse to the growth of a business. Especially when it comes to detecting smartly-committed frauds by your staff, it becomes difficult to trace the origin and join the missing loops. If you are using automated loan document management software, this complicated process can be streamlined. Moreover, the predictive analytics potential of these software systems alerts lenders about the credibility of an applicant. This calculative prediction is based on the previous track record of your potential client. 

  • Declining customer experience 

Where the majority of lending companies are incorporating automated loan origination technologies, your latency may result in reducing customer experience. The number of online loan applicants is increasing rapidly. The “Fiserv” data analysis report of 2019 has stated that more than 67% of home loan applicants in the United States are comfortable with the online processes instead of meeting a loan advisor. Smart data management, custom reports and fast risk assessment help in assisting customers in the best possible way. If you are not leveraging the advanced potential of software systems, competitors will surely surpass you. 

  • Inconsistency in workflow 

The efficiency limit of virtual technology is far beyond human potential. Even with the best skills in the market, the human workforce cannot maintain a stable consistency. Processes like data entry and document management may consume a lot of time when you are expecting fast execution. The software doesn’t get bored of repetitive tasks and deep analytical tasks. All you need is efficient hardware configured to work consistently. 

Are these reasons enough for you to adopt the advancement in the loan origination industry? If not, prepare to see the least-expected competitors surpassing your turnover in the upcoming days. 

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