Every piece of technology that your credit union implements should be carefully selected based on how it helps you to further the quality experience you're creating for your members. One way to do that is to build an infrastructure backed by software that increases organizational efficiency whenever possible. There are six features in particular that your lending software should have that will allow you to do precisely that.
What Bad Lending Software Will Feel Like
The over-arching thing you'll notice when utilizing bad lending software is a general inefficiency. The lending process will be slower than it needs to be and you'll regularly experience delays in terms of processing, approvals, and especially the disbursement of funds.
Your credit union will also be at increased risk because you won't be able to adequately assess the creditworthiness of your members. Compliance issues, data inaccuracy, limited customization, and an overall poor member experience are other examples of what bad lending software will feel like.
List of Essential Features
Delinquency & Collections Features
Being able to accurately track delinquency and collections is huge as it reduces the number of bad debt write-offs to deal with. It also reduces the amount of time you need to spend manually generating and sending invoice reminders.
Permissions
The term "permissions" has to do with the rights and access levels that different users have to the system within your organization. Loan officers can create and manage applications, for example. This helps enormously when it comes to security as only people who need access to certain functions have it. It also helps with compliance, efficiency, and risk management.
Instant Decisioning
The natural benefit to instant decisioning is one of efficiency. Every step of the process is faster, allowing credit unions to make rapid decisions. It's also more accurate, more consistent, and more compliant as well.
Seamless Modification
Seamless loan modification is a perfect opportunity to help reduce loan default rates for your credit unions. You can work proactively with members who are going through financial hardships to come up with more appropriate terms as opposed to letting them default on their loans outright. This is a great way to maintain member loyalty and can in a larger sense preserve your organization's asset value.
Flexible Funding Options
Offering multiple channels to close a loan can help increase activity among certain age groups. Offering a seamless experience where people can easily transfer from one channel to another is also a good way to encourage people to complete the process.
Reporting
Finally, your lending software should have access to canned reports that show you exactly how your credit union is doing at any given moment. Examples of reporting to look for include but are not limited to applications by officers, daily new money loaned, delinquent notices sent, interest exceeds payment, loan modifications, and amortized loan details.
Digital Lending Unleashed: Your Path to Organizational Efficiency
At FLEX, we've always believed that one of the best ways to increase organizational efficiency has to do with embracing the benefits that digital lending brings with it. In fact, we've recently authored an eGuide on the topic that shows you the true value digital lending can unlock for your credit union. Click the button below to download your copy and start reading.
