loan servicing software community bank small business


The defi Team Automation, defi INSIGHT, Digitalization, Servicing Systems

loan servicing software community bank small business

Looking ahead to the new year, banks, credit unions, and other lenders are reevaluating how they respond to unexpected economic conditions. In 2020, these institutions were challenged by the need to quickly adapt their lending practices to the reality of a worldwide pandemic, particularly regarding auto lease and loan management. Software used by consumer lenders has also had to more recently adapt to economic pressures like high inflation and rising interest rates. For many lenders, auto lease and loan management software still lacks the flexibility necessary to support an end-to-end digital lending process quickly becoming the industry’s standard.

Legacy lease and loan management software was shown to be less capable of such flexibility during the pandemic, which is a major reason why so many lenders are looking into other solutions to manage their auto leases and loans. Software solutions not only provide lenders with a way to implement procedural changes in their lending practices but also deliver the experience today’s consumers have come to expect. For lenders seeking out new auto lease and loan management software solutions, the current state of the auto market shows it’s a good time to do so. In fact, the digital lending market looks set to experience an average 13.8 percent compound annual growth rate (CAGR) until 2026, when it’s estimated to be worth $20.5 billion.

Yet what should lenders look for in new auto lending software? There are three major capabilities that every auto lender should consider for 2023 and beyond. The three most important factors to consider in auto lease and lending software should include cloud-based, mobile-friendly, and configurable solutions.

What to Look For Why You Need It 
Cloud-based lease and loan management platform Reduces IT operational costsImproves functionality and productivity via frequent software updatesEnables lenders’ employees’ access from anywhere there’s an Internet connection
All-encompassing mobile capabilities Meets consumers’ expectations for access to account information at any time and anywhereReduces call center volumesLowers printing and mailing costs
Menu-based configuration Allows lenders to tailor to their unique leasing or lending needsUpdates nearly every aspect of the platform easily

Why It Must Be a Cloud-Based Platform 

After the worst pandemic in over 100 years curtailed business throughout the world, cloud-based lease and loan software solutions have more than proven their value. By moving to a cloud-based solution, lenders eliminate many of the operational costs associated with procuring and managing IT infrastructure, along with other related hardware. Using a cloud-based platform also allows for frequent software updates that can be made immediately available to employees, regardless of their location, continually improving a lender’s process efficiency.  

A fully integrated cloud solution manages user access permissions and role configuration from a central location and across all servicing activities. This allows quick and auditable changes as a lender’s practices and processes evolve over time and in response to changing market conditions. Real-time updates regarding payment transactions additionally provide borrowers and servicing agents with the most up-to-date and accurate account information. 

A lender’s cloud-based lease and loan management software should be a fully integrated component of a platform that supports the end-to-end lending cycle. It should handle originations, decisioning, servicing, and remarketing while allowing the most current and accurate borrower data to be maintained throughout the life of a lease or loan. 

Why It Must Be Digital 

Today’s consumers expect mobile commerce capabilities across every industry. While the lending industry was moving that way in any case (albeit more slowly than most sectors), the events beginning in 2020 accelerated demand for entirely digital solutions. To better enable mobile lease and loan management, software should be capable of running on both Android and iOS, which together account for over 99 percent of mobile operating systems.

Digital lease or loan self-servicing should allow borrowers to:

  • Set up automatic payments easily for the life of the lease or loan. 
  • Initiate one-time payments to accelerate loan payoff. 
  • Obtain accurate account information and statements at any time. 
  • Update personal information. 

By giving borrowers greater control over their accounts, lenders reduce the number of call center inquiries. This allows customer care representatives to spend more time with those who truly need assistance. This also significantly reduces mobile servicing, printing, and mailing costs.   

Why It Must Have Configurable Capabilities

Lenders need flexible lease and loan management software solutions that can be easily configured to evolve with their changing processing needs. When dealing with lease and loan management, software solutions for lenders should include robust configuration menus that enable authorized users to make quick modifications across the entire platform. 

Configuration menus should cover a wide range of activities. These should include the user interface, workflow and queue management, and decision rules, along with how lenders can view payments, delinquencies, and defaults. Configurable capabilities should also allow lending professionals that aren’t versed in computer programming to easily make the necessary modifications to the software in minutes. This enables finance companies to remain flexible even under the most uncertain economic conditions.

Planning for 2023: Compare Cloud, Mobile, and Configuration Capabilities

Lease and loan management software continues to advance rapidly as artificial intelligence, machine learning, and other technologies make it easier than ever to implement, configure, and continually improve them. Lenders looking for software solutions that enable them to deal effectively with the economic climate in 2023 and beyond should focus on cloud, mobile, and configurable capabilities. These three features offer the flexibility needed to quickly make modifications and incorporate new capabilities into any leasing and lending management system. In fact, it’s never been easier than with today’s cutting-edge technologies to continuously improve productivity, reduce processing costs, and provide an exceptional customer experience. 

Getting Started

defi SOLUTIONS offers lease and loan management software solutions for the complete loan or lease lifecycle. Banks, credit unions, captives, and other finance companies partner with defi to utilize the company’s market-leading solutions, which allow lenders to exceed borrower expectations. By making lending easier, defi promotes digital engagement, flexibility, configurability, and scalability in loan management systems, originations, servicing, and managed servicing. For more information on our cutting-edge loan management system, please visit contact us today.

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