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Intelligent Lending Automation for Banks is Finally Here

Intelligent Lending Automation for Banks is Finally Here

Despite the 2008 crisis, borrowers still associate banks with reliability, stability, and low risks. These are some of the main reasons they choose to go with a large-scale enterprise like a bank and a credit union. But the problem with those institutions is that often they aren’t really up for the challenges of the digital age. And intelligent lending automation is the key to changing that.

With the development of technology, banks’ competition in the form of POS financing programs and alternative lenders started to grow. That’s exactly why 70% of banks heavily invest in technology. Bankers realize that to survive they need to strengthen their competitive positioning and grow/sustain their market share.

And in today’s market, you can only retain and convert borrowers if you deliver a smooth online experience, same-day approval, and cybersecurity while maintaining competitive rates.

Banks and credit unions have a way harder time digitalizing their services and products due to legacy core software that is in desperate need of a radical revamping. The problem is that creating a proprietary system for an efficient lending platform from scratch is often out of the question. It simply requires too much money and human resources. Not to mention that once it’s live, it needs to be constantly updated, supported, and maintained to stay competitive.

But if you go with ready-made lending automation, maintaining, securing, and updating your lending software is simply not your headache. The software provider is responsible for that.

How to choose a lending automation solution for a bank

There’s this notion among bankers that ready-made software solutions aren’t flexible, scalable, and sophisticated enough to power lending operations of a bank or a credit union. And in today’s technological age that’s simply not true. Advanced FinTechs are here and they are perfectly capable of addressing the needs of enterprise-level financial institutions.

All you, as a lender, have to do to fully automate your crediting process is choose the lending automation software carefully. Some of the things to consider include:

  • Functionality
  • Integrations
  • Intelligent credit decisioning
  • Business logic customization
  • User-friendliness
  • Compliance readiness
  • Ease-of-use
  • Updates
  • Support
  • Vendor track record

You can check an in-depth guide to choosing the right lending automation software here. But in a nutshell, to successfully compete in the digital environment you need the right tools. So don’t settle for half measures. The lending automation solution you end up using has to address all of your business needs as well as the needs of your borrowers and your employees.

Lending automation for banks done right

Compared to micro and alternative lenders, banks and credit unions have a drastically different set of requirements when it comes to lending automation. These companies tend to already have a sizable business infrastructure in place and whenever they implement new automation solutions, they need to make sure it integrates well and communicates with the core banking system smoothly.

TurnKey Lender offers intelligent end-to-end functionality sufficient to automate any type of lending task for crediting business, no matter the size or specialty. The trick is that small to mid-size lenders with similar requirements get the TurnKey Lender Box solution. It’s ready-for-use within one business day and fully automates the lending process from the get-go.

Larger institutions, with custom requirements, get TurnKey Lender Enterprise. It’s a fully customizable system powered by AI which can be adjusted to whatever needs a business may have. And since we’re focused on banks and credit unions in this article, we’ll take a closer look at this one.

TurnKey Lender Enterprise is a modular system that includes functionality to automate:

  • Loan origination
  • Underwriting
  • Collateral management
  • Borrower evaluation
  • Risk management
  • Debt collection
  • Loan servicing
  • Reporting
  • Supervision
  • Regulatory compliance
  • And more

You can get all of those as an all-in-one package or only implement the solution’s separate parts into your legacy system to automate the things you struggle with most.

And to answer your question about scalability, according to an independent performance test by Hewlett Packard, TurnKey Lender is a flexible configuration choice on a highly scalable and reliable infrastructure. It processes large loan application volumes (100+ per second) without skipping a beat and lowering risk evaluation standards. On the contrary, improving them, given that the scorecard is set up properly.

I know these kinds of numbers may not easily map on a run-of-the-mill bank. But answer me this, how much time would it take an origination department to process 100 applications?

TurnKey Lender integrates with the core banking system as well as all the necessary third-party products and data sources required for running a modern digital lending operation. The system has a drag-and-drop business logic editor built-in. It allows for in-depth customization of the solution’s architecture on the fly. It effortlessly does things that would previously take weeks to develop, design, and deploy.

But probably the biggest benefit of implementing TurnKey Lender’s automation are the self-learning deep neural networks and machine learning algorithms within the proprietary scorecard. They serve as a basis for the state-of-the-art decisioning engine that helps your lending operation process and approve more loans while increasing risk. This is achieved through a careful combination of traditional and alternative data sources and analytical approaches used in borrower evaluation and risk management processes.

Another big thing for banks, or any respectable financial business for that matter, is cybersecurity. TurnKey Lender employs a certified ISO 27001 auditor, who has a Ph.D. in Cyber Security. The solutions of the company also meet all the international standards according to the ISO 9001:2015 certification. The company has been accredited by the Singapore government to work with state and enterprise-level institutions. Very few companies get accredited by IMDA due to their high standards so their vote of confidence shows that TurnKey Lender cares greatly about the quality and security of the solutions and is a partner to be trusted.

Final thoughts

Lending automation and overall crediting digitalization are inevitable. If they are to survive and prosper in the digital age, banks, credit unions, and other large-scale lenders will have to adjust to the new market realities. But worry not, this process doesn’t have to be painful and outlandishly expensive. Get in touch with TurnKey Lender and schedule a demo of the system. See what lending automation can and should look like.


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