Auto finance analytics are usually the domain of specialists schooled in the finer points of finance and advanced statistics. Some specialists learn SQL to expertly sift through volumes of lending data. With these talents, they uncover patterns hidden in portfolio terabytes, and discover subtle anomalies that hint of developing trends—and opportunities.
Whenever anyone in a large auto finance organization needs analysis or a report, the request typically goes through the specialists. Executive-level projects take priority; smaller—but nonetheless valuable—requests get tossed into a backlog. Small firms rarely have the luxury of this caliber of in-house auto finance analytics expertise.
Auto Finance Analytics: Big Data Demands Innovation
Internet, cloud, and mobile technologies generate ever-greater volumes of financial data, which has made big data a reality for every auto finance organization: Banks, credit unions, and fincos. Big data created the need for better (easier) methods of analyzing that data, methods that allow lending professionals who aren’t finance or statistics Ph.D.s to easily obtain meaningful insight from their lending data.
Modern loan origination solutions are addressing this need with three innovations that enable key auto finance personnel, including underwriters, loan officers, credit analysts, funding and servicing personnel, and executives to obtain the analyses, reports, and insight needed to assess lending efficiency and improve portfolio performance with integrated auto finance analytics.
#1 Analytics Natively Integrated with Loan Origination Systems
The most significant innovation in auto finance analytics may be the native integration of analytic and reporting capabilities with the loan origination system. When a software vendor provides this integration their clients benefit by:
- Eliminating the time and cost of integrating add-on analytics software that often requires a detailed understanding of the data warehouse schemas and custom coding or programming;
- Using single sign-on to let users easily move between the LOS application and analytics capabilities. A user who notices an anomaly in a report can instantly access the details (actual application data, the underwriter, or terms) of underlying data; and
- Allowing line of business professionals to conduct analysis and create reports without any need to understand the technical details of the underlying data warehouse.
With native integration, analytics and reporting are a natural extension of a loan origination system, allowing lending professionals to easily obtain access to the information needed to improve lending practices.
#2 No Need to Build Reports from Scratch
LOS software vendors who have supported lending businesses for years know what information lenders need to closely monitor business performance. Natively-integrated analytics and reporting give lenders a wide range of pre-configured dashboards and reports that make it easy for lenders to monitor:
- Origination trends;
- Operational efficiency;
- Collateral valuations; and
- Credit approval metrics.
Dashboards let business users create reports that visualize performance immediately. Users can also apply filters to focus on specific data subsets or loan details. Pre-configured dashboards and reports provide lending insight without the need for in-depth analytical skills.
#3 Configurable Dashboards for Unique Reporting Needs
Out-of-the-box analytics and reporting make it easy for line-of-business professionals to gain insight into key aspects of lending performance quickly. However, every lender is unique; they understandably want to be able to analyze lending processes and portfolio data in ways meaningful to their business.
Configurable dashboards let business professionals modify default reports easily, and to define and create new self-service reports. Using the dashboard, users point and click to select relevant data fields, group data, or filters as needed to summarize activities, track developing trends, and uncover potential opportunities for process improvement or risk mitigation.
A user may configure a report like “Loan applications by tier for the past month”, and have the report automatically show only the applications of the individual underwriter whenever an underwriter runs the report. That’s much more efficient than configuring a separate report for each underwriter. Reports can be run on demand to monitor performance in near-real time or scheduled to run on a schedule. Reports can be shared with others easily and securely, and downloaded for future reference,
Auto Finance Analytics: Innovation for Insight
Today, innovations in auto finance analytics help lending professionals analyze processes and portfolio performance without extensive database or statistics skills. Tight integration between LOS and analytic tools, pre-configured reports, and easily-configured dashboards deliver business insight, detailed understanding of lending performance, and opportunities for continued business improvement.
defi SOLUTIONS focuses on the lending industry. We’ve developed innovative auto finance analytical solutions for lenders that don’t require major technical or financial investments. Take the first step toward better lending performance by contacting our team today or by registering for a demo of defi LOS and defi ANALYTICS.
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