Community banks understand the lending needs of individuals and small businesses

CREDIT UNION LENDING SYSTEMS: A SELECTION GUIDE

The defi Team Credit Unions, defi INSIGHT, Managed Servicing, Originations

Community banks understand the lending needs of individuals and small businesses

The current market situation for credit unions is challenging. High interest rates have driven the cost of borrowing upwards, shrunk margins on loans, and impacted the bottom line. Nevertheless, new members continue to join credit unions thanks to their attractive rates and services, which most banks cannot provide. In fact, the U.S. credit union market has increased at a compound annual growth rate of 4.4 percent over the last five years, reaching $124.8 billion in 2024, according to data from IBIS World.

There’s an opportunity for credit unions to deliver industry-leading financial services to new and existing members. This is combined with the need to provide advanced lending services expected by borrowers who have become accustomed to efficient, on-demand, digital transactions. Modern credit union lending systems enable institutions to tap into this growth opportunity. 

“Modern credit union lending systems enable institutions to tap into this growth opportunity.”

Does Your Lending System Address Today’s and Tomorrow’s Needs?

For too many credit unions, a review of their current system brings the realization that improvements are needed. Based on more than three decades of lending industry experience, we offer a quick selection guide highlighting the capabilities that modern credit union lending systems should provide. These capabilities establish a solid foundation to address today’s lending needs and to easily incorporate functionality to remain current, efficient, compliant, and profitable as your market evolves.

Credit Union Lending Systems – What Do You Need? 

We’ve organized this selection guide into two sections. The first covers critical capabilities that enable a more efficient loan origination process. The second section focuses on capabilities that support the unique account servicing needs and improve the experience for credit union members and agents.

First, let’s look at the capabilities that improve loan origination efficiency. 

Loan Origination Efficiency

Capability

Reason

Cloud-based Platform

✔ Proven CapEx and OpEx advantages in comparison to on-premises solutions.
✔ Frequent, automated software updates allow users to take advantage of the latest functional improvements and features. 

✔ Easy integration with an ever-growing number of innovative cloud-based lending services designed to enhance decision quality and productivity.

Configuration

✔ Allows lending professionals to customize and modify user interfaces, credit policies, workflows, formulas, and decision rules. 

✔ No need for programming skills to make modifications. 

✔ Automatically maintain a record of configuration changes in support of compliance requirements.

Integration with Cloud-Based Services

✔ Quickly extend the functionality with innovative capabilities such as alternative data sources, employment and income verification, fraud identification, vehicle valuation, and e-contracts. 

✔ Select those services that meet your specific lending process needs.

Analytics

✔ Integrated analytics with pre-configured reports give lending professionals critical insight into the sources and attributes of loan applicants, underwriter productivity, risk factors, and loan performance.
✔ No need for database or data scientist skills. 

✔ On-demand access to reports that deliver accurate, current analysis supports continuous process improvement and optimized lending strategy.

Now, let’s examine the factors that produce account servicing efficiency. 

Account Servicing Efficiency

Capability

Reason

Integrated Account Administration Platform

✔ Provide a seamless transition to servicing by easily importing contract data generated during loan origination. 

✔ Comprehensive accounting engine maintains a general ledger chart of accounts and maps portfolio balances to the corporate general ledger for real-time processing and reconciliations.

Configuration

✔ No need for costly, time-consuming custom programming. 

✔ Use rules and parameters to define and control workflows and servicing processes and tailor them to your unique lending needs. 

✔ Map portfolio balances to the corporate general ledger for real-time data synchronization.

Default Management via Automation

✔ Create rules within workflows to track and manage delinquent accounts. 

✔ Automate routine collection steps allowing agents to focus on more complex cases.

Third-Party Integrations

✔ Easily add capabilities such as AutoVIN and AiM vehicle

Inspections, Dealertrack Payoff Quote, LexisNexis Bankruptcy Monitoring, and Recovery Data Network Repossession to further improve account servicing efficiency.

Real-Time Data Processing and Reporting

✔ Eliminates out-of-synch data caused by overnight batching. 

✔ Agents always access current, accurate borrower data and loan status, bringing efficiency to all dialer queues and other borrower communications.

Multi-Channel Customer Care

✔ Configurable workflows execute, track, and record all inbound and outbound borrower interactions (phone, email, text, post, chat), including welcome calls, fulfillment, and complaint investigation and resolution. 

Comprehensive Collateral Management

✔ Support the spectrum of auto, truck, motorcycle, marine, and recreational vehicle financing needs. 

✔ Track and manage titles, identifying those missing, and requiring corrections or re-issuance. 

✔ Process state-to-state transfers.
✔ Automated alerts for balloon accounts about to mature. 

✔ Offer borrowers educational services and tailored retention programs.
✔ Efficiently liquidate repossessed vehicle inventory. 

✔ Remarket returned vehicles with auction updates until vehicles are sold.

How Does Your Current System Compare?

This quick selection guide provides criteria for decision-makers to evaluate their current credit union lending system and identify key areas in need of improvement. Cloud capabilities, easy integration with innovative lending services, extensive automation, real-time data processing, and the ability to configure the system to meet unique lending processes are critical to efficiently delivering services in a cost-effective manner. Today may be the ideal time to invest in capabilities that position you well for the future.

defi SOLUTIONS loan origination solutions offer these capabilities and more.

Key Features of Defi Loan Origination Systems

✔ Scalable cloud-based platform

✔ Built-in APIs and quick integrations with third-parties

Automated underwriting, decisioning, deal structuring, and funding

Data analytics capabilities

✔ No-code configuration for workflows, rules, policies, features, and admin functions

✔ Fully integrated mobile apps

✔ Customer-facing portals and other customer service tech

✔ Support for advanced features like AI and machine learning.

✔ Support of complex pricing matrices

✔ Quick implementation of business decisions

The benefits of industry-leading loan origination systems like defi are clear. So let’s talk about what you need.

Getting Started

defi SOLUTIONS is redefining loan origination and servicing with software solutions and services that enable lenders to automate, streamline, and deliver on their complete end-to-end lending lifecycle. Borrowers want a quick turnaround on their loan applications, and lenders want quick decisions that satisfy borrowers and hold up under scrutiny. With defi’s originations solutions, lenders can increase revenue and productivity through automation, configuration, and integrations and incorporate data and services that meet unique needs. For more information on credit union lending systems, contact our team today and learn how our cloud-based loan origination products can transform your business.

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