Why Should You Use A Cloud-Based Loan Origination and Loan Servicing Platform?
Automation and cloud computing have brought in a whirlwind of change globally and the financial services industry is no exception. As such, traditional banks and lenders all over the world are now looking to adopt and implement these disruptive technologies to boost their efficiency and revenues. Loan Origination System and Loan Servicing System software financial services are much sought after by lenders and Financial Institutions.
Customers, too, are increasingly getting used to quicker processes, and turnaround time, therefore having a business model that supports such needs is indispensable for lenders, especially the ones who look to grow exponentially.
Cloud computing carries the potential to transform the financial services business by reinventing the business and operating models. By helping a lending business to connect with a virtual platform, cloud computing enables businesses meet their needs at much lower costs and lesser time, thereby letting business strategy teams focus on business innovation and deliver delightful customer experiences.
The main advantage of this platform is the ease with which it manages a large amount of data efficiently and rapidly without spending a huge amount of money on it. Scalability, too, is counted as a major plus when it comes to cloud-based loan origination or loan management software.
If you are a lender who’s considering adopting loan management software but aren’t sure if you should go for a cloud-based one or an on-premises one, we hope this article will help you gather a better understanding of the former and how it might help your business scale and grow.
Benefits of a cloud-based loan management system
Let’s delve a little more into the benefits of cloud-based loan platforms for the lending business:
1. Improved Customer Experience
Top loan origination software provides lenders with cloud-based solutions that offer an improved and consistent experience to the customers across multi-channel touchpoints.
Along with enhanced user-experience customers also enjoy the cost-benefit that lenders can pass on to them in the form of competitive interest rates, thanks to the cost-efficiency of cloud-based solutions. This is possible as cloud-based solutions are capable of reducing loan processing time by removing the dependence on excessive paperwork, manual processing time, reducing errors, all of which go on to provide customers with much-needed, seamless processing in a loan origination system.
2. Time-to-Market
Cloud-based modern loan management software for small businesses helps lenders get started within a month. However, building software from scratch would take no less than a year to get built and implemented. This saves a year of IT expense and helps businesses rake in revenues from the first year itself.
The easy implementation saves the lender from the trouble of downloading and storing large software on their system. Instead, it lets them create a fluid workflow by allowing them to work from remote locations and access documents in real-time using features like updating, storing, saving and sharing documents from anywhere in the world.
3. Innovation
In today’s date, in a market sought with changing algorithms and disruptive technologies, lenders need the kind of loan management system software that is agile, flexible, and scalable. These features can make it or break it for lenders who are entering a competitive market or are already present in the market and trying to differentiate themselves from their competitors. Cloud-based technology enables lenders to execute new ideas with efficiency, at a high speed, and at a lower cost.
4. Real-time Analytics
Real-time analytics are crucial in analyzing the overall performance of a business. Modern loan origination software, which is mostly cloud-based, provides a 360-degree view of the overall performance, as well as the status of loan applications, is easy to assimilate analytics presented on a user-friendly dashboard. A glance at such analytics can give lenders an idea as to what changes could improve the business’s revenue, how to reduce costs, identify outliers and make required changes with immediate effect. Analytics from Loan Servicing data also help in identifying borrower behavior, assess risky accounts and take proactive measures.
5. Data Security
Data security is often a concern for business owners considering cloud computing. However, cutting-edge technology comes with cutting-edge data security standards and best practices, as well, that are followed worldwide. With proper controls such as authentication, access control, data encryption, data masking, integrity checking, and secure deletion, lenders can be assured that their data is protected and secure.
When it comes to data security on cloud computing networks, the risks are similar to that of on-premises networks. Hence, it makes sense to learn about what steps lenders can take or seek from their loan management software provider to ensure maximum data security and privacy.
6. Access & Collaboration
Cloud collaboration is one of the best features of cloud-based loan origination software, authorized employees have access to the required data even when they are out of the office or working from remote locations. This enhances internal communication among employees, increases efficiency, smoothens workflow, reduces turnaround times, and boosts transparency in the loan process. The overall result of which is a better customer experience.
Here’s what lenders need to consider when choosing the right online loan origination or loan management system for their business:
- Short and Long-term Business Needs
The lending software works as a tool to support the overall business strategy. To begin with, review the short-term and long-term business goals, the loan management software that is being used currently and if they are in line with the technologies that are being used by market leaders and competitors at the given time. This review will act as the basis for selecting the right cloud-based platform for the business.
- Budget
Pricing plays a major role in selecting the right software for lending businesses. By conducting a cost-benefit analysis and understanding the benefits that lenders stand to reap after implementing the software within the organization they can make an informed business decision that will prove beneficial in the long term. Lenders can use the flexible and scalable features of cloud-based modern Loan Origination Software or online Loan Servicing Software and only pay for features that they are actually using.
- Easy to Deploy, Easy to Learn
The loan management software of choice should be easy to implement and use by employees. It should also offer bug fixes and updates at regular intervals that ensure smooth processes and fewer errors. The fact that cloud-based loan origination and loan management system software is almost completely customizable to the needs of the lending business makes it a clear winner.
The online loan management system also removes the need to maintain an in-house IT team. This is especially helpful for small businesses that don’t have the funding or infrastructure to maintain an IT team in the first place.
Conclusion
Cloud-based top Loan Origination software and Loan Servicing software are revolutionizing the online lending scenario. By quickening the processes of loan origination, underwriting and servicing with greater comfort and lesser errors, the technology is fast changing the competitive landscape of the financial services industry. As such, adopting and implementing an online loan management system can be hailed as one of the top differentiators that can establish lenders as a leader in their space.
