Loan Zone: Setting the credit speedometer

Everyone talks about swift payments, but what about swiftness in lending?

Gaining speed around providing credit is a different proposition from speedier payments. Fast credit focuses on the critical but relatively infrequent front-end event of screening applications and approving loans. Once a mortgage or car loan has been made, borrowers like payment convenience but don’t care about speed unless they are delinquent. And a credit card linked to an approved line of credit generally provides a fast-enough way to buy something on credit.

The key these days to speedy lending is using mobile device technology to reduce member friction and add value, observes CUES member Kris VanBeek, CCE, CIE, president/CEO of $1.25 billion USAlliance Financial, Rye, N.Y. USAlliance Financial members can use their smart phones’ cameras to upload loan application documents; use text recognition to capture name and address information of a photo of a driver’s license; and create virtual strong boxes to securely store important documents like birth certificates and tax filings that might be needed to attach to credit applications. They can also use their phones GPS features to validate location and support authentication.

For credit products, the need for speed is concentrated primarily on the front-end decision and implementation, explains Sabeh F. Samaha, president/CEO of Samaha & Associates Inc., Chino Hills, Calif. Decisions should be fully automated or mimic full automation, he says.

“All the pieces needed to make a decision should be pulled together online in real time, including those drawn from third-party systems,” he notes. Then the onboarding should be automated and essentially instant, with full visibility of the status to the applicant. Once that has happened, the need for speed is less urgent, but still needs to be applied to processing delinquencies, collections and workouts, he adds. “It’s all about integration and seamless automation.”


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