With an increase in digitalization due to COVID-19, more and more industries are adopting cloud-based software to increase their market share while working remotely. The same impact has been seen in the Loan Management software industry. It is expected that the Loan Management software market will grow by USD 2.43 Billion during the year 2020-2024.
Customers have also grown to expect instant solutions to all their lending requirements. From an application for loans to processing and sanctioning loans, customer’s demand for ease and convenience has never been greater. Therefore it becomes essential for the lenders to improve their services and offer simplistic solutions.
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All these problems can be addressed by investing in the right loan management software. Not only will it help the organizations serve the needs of their clients better but also streamline the process of offering configurable modules of all types of loans.
But before we get in-depth into how it can help you, you need to know everything about loan management systems.
What is the Need for Loan Management System in Your Organization
#1. Security of Client Data
In the first half of 2020, the US faced $8.64 million worth of data breaches alone, which indicates the importance of having the best cybersecurity, primarily if you work with loan origination. Protecting your client’s sensitive data is an issue that requires your complete attention. Your client will entrust you with their essential information such as Permanent Account Number, income tax returns for past years, etc. This information has to be protected.
A cloud-based loan management software can streamline your entire process regarding security. It will help you to reduce paperwork and save you from any identity theft. Plus, it’s a green solution; hence it will also save additional costs on office supplies.
#2. Improve Customer Experience
Consumers are now moving towards quick online solutions for all their needs. Even for finance, consumers are looking for hassle-free online solutions. Keeping this in mind, lenders should adopt new financial systems that cater to the needs of clients.
Loan management software will ensure maximum customer satisfaction and help the organization retain the clients in the long run.
#3. Improves Overall Efficiency
The cloud-based system allows the employees to focus on their core capabilities. They no longer need to concentrate on redundant tasks; instead, they can maximize sales and customer satisfaction.
#4. Reduction in Errors
Apart from keeping all the information safe and organized, loan management software will also reduce errors. Billing and payment errors are most common in any financial institution. Good loan management software will collect and store the entire data neatly and mitigate errors to better future client problems and loan issues.
#5. Remote Accessibility
Workplaces have changed significantly after COVID-19. Employees are now working from home. Business organizations are now opting for software that helps to establish better communication with customers. A cloud-based loan management software is helping organizations to manage all the employees.
#6. Timely Compliance
A financial institution is required to follow a variety of laws and regulations. Loan management software creates a compliance calendar that generates timely reminders. These reminders help an organization to fulfill all the regulatory compliances on time.
What To Look For in a Loan Management Software?
MarketWatch’s recent report studied the impact of coronavirus on lending market software while identifying the major features one should survey while choosing the right loan management system to run your lending business.
If you realize the need for loan management software for your organization by now, the next step is to find the right software for your organization. There are various features that you should look for in cloud-based software for loan management. We have enlisted some of them for you –
#1. Ease of Use
You have to train your employees to use loan management software. This transition from paperwork to a paperless environment should be easy for the employees. You need to choose a software that is easy to use and requires minimum training for employees. A simple and straightforward user interface will ensure easy onboarding.
Pro Tip – Before investing in any software, you can opt for demo sessions or free trials to feel how each software works.
#2. Customizable
There is no one-fit-for-all loan management software. There will be many customizations required as per the needs of your organization.
Make sure to choose software that is modular and flexible to accommodate the unique needs of your institution. Various additional features like consumer helpline portal, document templates, document vault, etc. can be added as your organization grows.
#3. Easy Integration
Choose a loan management software that seamlessly integrates with all the third-party solutions. This will help you to exchange data across various platforms easily. It will also ensure that no time is wasted in manually exporting or importing the data.
For example, there will be a seamless connection between your loan management software and the finance department or document repository. It will also help employees to focus on core activities rather than wasting time on routine work.
#4. Accuracy
For financial institutions, it is imperative to gather accurate information about clients. This information not only includes the personal data of the clients but other data such as credit history, job history, past income, etc.
With this accurate information about the clients, you can design personalized solutions to serve their needs best. It will also ensure that your funds are not blocked due to incorrect information.
#5. Security
Security is one of the essential features to look out for in loan management software. This tool will contain all the vital information about your clients, like their financial records. It is essential to ensure that this data is secure. Invest in the software with useful security features to stay protected from cyber hacks and identity thefts.
#6. Scalability
Lastly, if you plan to expand your organization in the future, then choose software that grows with you. A good loan management software is modular enough to offer additional features when the organization grows.
Final Word
Loan management software is a robust tool that offers a variety of features. It helps you to carry out the entire loan sanction process effectively. Also, it will help you to organize the data in a better way.
So when you start looking for a reliable loan management software, be sure that any software you choose passes the guidelines we laid out for you. If you need any help finding better software for mortgage origination and loans, check out our list of some of the best loan management systems here.
Can you think about any other filter that we might have missed out on? If so, let us know in the comment section below.
Supriya is a highly skilled content writer with over 8 years of experience in the SaaS domain. She believes in curating engaging, informative, and SEO-friendly content to simplify highly technical concepts. With an expansive portfolio of long-format blogs, newsletters, whitepapers, and case studies, Supriya is dedicated to staying in touch with emerging SaaS trends to produce relevant and reliable content.
