The consumer lending business is centered on the notion of managing the risk of borrower default. The increasing concerns around Non-performing Assets have stressed the entire financial system. NPAs are one of the significant challenge lenders faces, and an immense need to strategize and implement a comprehensive approach to managing NPAs has risen. Lenders must… Continue reading Early Warning Solutions for Non-Performing Assets
Category: Consulting
Credit Risk Management: Optimize Lending in 3 steps.
Given the enduring prominence of credit vulnerability as the primary risk factor within the global financial industry,
How Alternative data can help lenders in reducing financial risk?
Over the years, an individual’s or even an organization’s creditworthiness is defined by their credit score.
The pandemic has halted the proliferation of traditional paper-driven, face-to-face loans and forced commercial lenders to move toward digitalization. Additionally, fintech companies addressing the same issues are on the rise and are giving traditional consumer lenders a run for their money. Consumers are now moving towards creating bank accounts online to conduct transactions digitally. Meanwhile, an appetite for “Open Banking” is picking up pace worldwide.
Why Should Business Lending Use Open Banking?
Lenders require account data to make decisions on which businesses are eligible for loans. Open Banking is driven by regulatory, technology, and competitive dynamics. It calls for banks to use APIs to make certain customer data available to non-bank third parties. The innovation is evolving the industry toward hyper-relevant, platform-based distribution and giving banks a rich opportunity to expand their ecosystems and extend their reach.
Cloud-based APIs are at the heart of these digital transformation strategies. Simple plug-and-play functionality makes it possible for financial institutions to adopt an integrated environment of applications, all designed to automate critical workflows to return faster credit decisions. Aggregating data across multiple accounts into one easy-to-use platform, offers customers a 360-degree view of their spending and simplifies the ever-growing number of touchpoints they encounter daily. Open banking will also enhance real-time payments, going head-to-head with the card scheme to enable instant transactions between retailers and consumers.
Open banking allows for automated bank statement collection. It also provides data on the debt and cash flow profile of a business that enables business lenders to understand the financial health of a business.
The Future
From offering personalized insights to simplifying payment transactions, Open Banking provides the spark banks need to develop modern financial tools that provide even more value to their customers. It’s like a collaboration between traditional bank players and new financial players. Moreover, open banking is helpful for SMEs as well. Via APIs, fintech companies will be able to access different types of accounts, insurance, card accounts, and leases, and consolidate data from multiple countries into one frame.
With Fed rate hike, how can credit unions navigate?
The Fed is set to raise interest rates in 2022 faster than it has in decades. Credit Unions knew higher interest rates were on the way, but few expected the extraordinary pace at which they are now expected to rise. This scenario is pushing credit unions to re-evaluate both their lending and investment strategies. … Continue reading With Fed rate hike, how can credit unions navigate?
Top of mind for Credit Unions to watch out for 2022
In the past 22 months, Credit unions are being challenged with evolving regulatory changes, more robust disaster planning, and widespread staffing shortages. With views on lending slowly returning to ‘normal’, it is the right time for Credit unions to identify the Credit Union trends 2022, so that CU CEO’s can focus while implementing post pandemic… Continue reading Top of mind for Credit Unions to watch out for 2022
Realizing the digital promise-building back better in a post COVID-19 world
COVID-19 has brought about a powerful shift in reality; in addition to the effects
How secure is your Credit Union from third-party frauds?
Third-party frauds has been on the financial industry’s radar throughout 2020, with account takeover and account opening fraud representing high opportunities for risk. Today more and more personally identifiable information is available on the dark web due to data breaches and phishing scams. COVID-19 has created both opportunity—increased online presence and interaction—and need—in the form… Continue reading How secure is your Credit Union from third-party frauds?
How to improve Customer loyalty in lending – 5 steps to consider!
Being in a competitive industry you’re smart to implement emerging technologies to reduce operational and customer acquisition costs. But, do you know what’s even smarter? Knowing customer is the most valuable asset, and firms should find ways to improve customer loyalty in Lending and strengthen it. Unfortunately, many firms across the globe, often aren’t… Continue reading How to improve Customer loyalty in lending – 5 steps to consider!
Managing member experience during the Covid 19-Tips to Credit Unions!
Like any other industry, COVID-19 has created new, immediate needs for credit unions: Rapidly transitioning to remote work, serving members with reduced branch availability, reallocating branch staff to address increased call center traffic and supporting members in financial distress through deferments, emergency lending and more creative, tailored arrangements. Now it is the time for Credit… Continue reading Managing member experience during the Covid 19-Tips to Credit Unions!