How the End-To-End Loan Service Model Is Changing for Auto Lenders

END-TO-END LOAN SERVICE DEPLOYMENT IN LARGE-SCALE CLOUD INFRASTRUCTURE SIMPLIFIED

The defi Team defi INSIGHT, Servicing Systems, Simplifying Processes

End to end loan service deployment in large-scale cloud infrastructure

Data silos occur when one group within an organization makes its data difficult to access by others within the organization. The “silo” metaphor comes from the storage units where different kinds of grains are stored while awaiting shipment. The more data that’s collected, however, the more difficult data is to access outside this specific department. This creates barriers within an organization, making collaboration more difficult. It also causes data quality across an organization to suffer, as relevant data is often not shared across departments.   

Within an end-to-end loan service deployment, large-scale cloud infrastructure helps mitigate information silos and make processes as seamless as possible. Enabling sharing across a lender’s departments will allow collections data to be accessible by those tasked with originations and vice versa. For example, this means that a customer’s contact details that are available to one department are available to users with the right permissions across all departments. So, when a borrower is late on a payment, instead of contacting another department to find out the customer’s updated mobile phone number, a member of that department can easily access it to send a reminder using the customer’s preferred method of communication. As other businesses have adopted cloud computing to enhance customer experience, lenders too can take advantage of cloud-based platforms to provide their customers with better, quicker, and more efficient service. 

How End-To-End Loan Service Deployment in Large-Scale Cloud Infrastructure Can Benefit Lenders

Lenders should be aware of how cloud computing can positively impact an end-to-end loan service. Deployment in large-scale cloud infrastructure enables lenders to take advantage of a broad spectrum of services, including data analytics and other software applications, as well as nearly limitless data storage. While allowing access to a wide range of these services from any connected device, the back-end servers and systems referred to as the “cloud” also give lenders additional data backups and enhance cybersecurity. 

Benefits to lenders of cloud computing include:

  • Additional security and encryption help safeguard against data breaches. 
  • Data and documents that can be modified and shared in real-time, making operations more efficient. 
  • Decreased chance of human error. 
  • Enables lenders to scale up and down operations as needed. 
  • Ensures lenders meet minimum requirement for documentation. 
  • Helps maintain confidentiality and minimizes risk of unapproved access to data.
  • Lets lenders process applications more accurately and quickly. 
  • Makes rolling out new products easier and quicker. 
  • Makes the underwriting process more efficient by automating approval process. 
  • Reduces risk by checking multiple sources of data for documentation. 
  • Upgrades are quick and require minimal downtime.

Cloud computing has revolutionized the consumer financing sector, delivering better customer experiences while lowering lenders’ business expenses. This is especially so for aspects like originations, which benefit from the ability to analyze large amounts of data quickly and efficiently. Lenders who fail to keep pace will be left behind by competitors who embrace this move to the cloud.  

Breaking Down Silos: Why Connecting Departments via the Cloud Matters

While cloud-based applications and data storage help reduce data silos, there are also organizational aspects that should be considered as well. Data centralization allows lenders to offer their customers a more efficient end-to-end loan service. Deployment in large-scale cloud infrastructure helps streamline processes involving collecting and analyzing data. The result is that what once took weeks or days can now be accomplished in hours or even minutes.  

This can make all a lender’s processes more efficient. When considering just the aspects involved in loan originations, this can go a long way in reducing delays in approvals and expanding a lender’s overall portfolio. Centralizing data enables analytics software to see a more holistic picture of a lender’s customers and their needs. It also helps balance the need for both security and privacy. Moreover, cloud technology connects a lender’s departments to each other, creating a more cohesive business environment. 

Cloud Integration to Prevent Cloud Siloes

The increasing embrace of cloud computing within the financing sector doesn’t necessarily eliminate siloes completely, however. Processes and data can still become siloed, though these develop in the cloud rather than on-premises due to the proliferation of cloud-based applications. Dealing with cloud siloes requires integration, and it makes sense to partner with a third-party vendor to maximize efficiency. 

How Customers Benefit from Cloud-Based Originations

While lenders see the benefits of cloud technology in terms of optimizing efficiency, consumers also benefit from cloud-based digitalization. When it comes to an end-to-end loan service deployment, large-scale cloud infrastructure for lending gravitates towards origination systems, which are increasingly popular among borrowers. 

Loan origination systems offered by lenders must be flexible to meet consumers’ needs, scalable to keep down response times to customers, and reliable to ensure a speedy application process. To support this, loan origination software should be automated and highly integrated to ensure the most efficient process. Cloud-based originations also reduce the turnaround time for applicants, leading to an increase in the usage of these digital lending solutions.

Benefits of cloud-based, automated loan origination platforms include:

  • As automation reduces labor costs, lenders can then offer better rates and terms to borrowers. 
  • Automated decision-making becomes more accurate and transparent, as approvals are largely based on the information gathered in the application process. 
  • Cloud-based applications allow data entry in real-time, providing quicker response times for potential borrowers. 
  • Cloud-based architecture allows workflows to take place across multiple platforms simultaneously and seamlessly. 
  • Cuts processing time in half (if not more).
  • Instantaneously collects up-to-date credit data from applicants.
  • Keeps sensitive information safer by prioritizing cybersecurity. 
  • Quicker response times and greater accuracy leads to higher customer satisfaction. 
  • Streamlines workflows to allow quicker turnarounds.
  • Submitting a cloud-based application lowers the chance of inaccurate assessments and human errors. 

When a lender’s customers benefit from technology, the lender benefits as well. The more well-vetted applicants that are approved, the more a lender’s portfolio will grow, along with the lender’s profits. 

Getting Started

defi SOLUTIONS offers a total solution for a lender’s complete loan or lease lifecycle. Partnering with captives, banks, credit unions, and finance companies, defi’s market-leading solution helps lenders exceed borrower expectations. From digital engagement through the complete lending process, defi sets new standards for flexibility, configurability, and scalability in originations and servicing (by your experts or ours). defi SOLUTIONS has the backing of Warburg Pincus, Bain Capital Ventures, and Fiserv. For more information on end-to-end loan service deployment in large-scale cloud infrastructure, please visit www.defisolutions.com.

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