Although Excel spreadsheets are a go-to model for the property loans firms, they are a typical illustration of today’s lenders’ struggles. Despite their capacity to meet the basic needs of the financial services industry, Excel was not designed as an application to handle loan underwriting.
An SME property lender needs portfolio insights, lineage, storage and retrievals. All of these flaws of Excel are addressed by Software-as-a-Service (SaaS) lending platforms, created specifically for loan management.
Digital transformation is inevitable
Like the rest of the world, the lending landscape in property finance is shifting towards digitisation and automation. Modern technology accelerates the speed of progress and scalability of businesses, and those that fail to adapt will be left behind. Simply put, manual and paper-based loan management processes are too time consuming to be seen as relevant.
At Hypercore.ai, we aim to help our customers to transition smoothly from outdated techniques to the world of cloud based digital automation. If this is something you are looking into, why not book some time with us?
Loan analysts are ditching Excel sheets for SaaS solutions
There is solid reasoning behind loan analysts steadily turning to SaaS platforms for managing property loans. Previous pain points and major frustration causes of Excel are resolved in SaaS software, therefore shaping a trend of onboarding innovative solutions.
Accessibility has always been both an inconvenience and a security concern of spreadsheets. Stored on the hard drive, it could only be accessed on the machine that has the file. Additionally, if someone is working on a spreadsheet, it locks everyone else out.
Often that results in duplicates with different edits on each, making it hard to trace back to the correct version. Traditionally, spreadsheets are shared internally via email - and emails are not difficult to hijack, therefore the security of your data is jeopardised.
Cloud storage of a lending software enables storing data in an off-site location, accessible via internet connection to multiple users simultaneously. All edits are carried out real-time and are visible to every user logged in. As a cherry on top, security of the data is taken care of by the third-party cloud provider - in this case a SaaS lending platform.
Being vital yet begrudgingly time consuming, data visualisation is among top infuriating things about Excel. Limited filtering options require hand-picking data and inserting it into charts and tables created in other software. Depending on the size of the spreadsheet, this process can take many hours.
Data visualisation and filtering are at the core of SaaS loan servicing software. Both processes are human-error free and take mere seconds to be completed, delivering easy to read and analyse data reports.
SaaS loan portfolio management can save the lender hours if not days by allowing to pre-screen and score the borrower within minutes. This wins the analyst extra time to carry out tasks requiring human judgement: ratio analysis, interest rate, forecasting models, data interpretation and others.
Automation of loan origination also delivers improved data integrity, governance and data lineage. Implementation of it at the key stages of the process ensures robust risk management.
Loan servicing only begins with the origination process, and further monitoring of the asset is one of the major challenges for the lenders. Setting a standardised process of financial data collection is a tricky yet crucial step - a failure results in inefficient and risky tracking.
Automation of annual, quarterly or monthly data monitoring and risk assessment provides peace of mind to the analysts. Not only implementation of AI means elimination of human error, but data gets collected in a timely manner and then delivered when it needs to be.
Although the financial industry is perceived to be an innovation pioneer, the process of managing property loans has not changed in decades. As the sector grows more competitive, however, digital transformation through automation is the only way of staying afloat.
Ditching out-dated practices such as usage of Excel spreadsheets and implementing technological solutions like SaaS enable SME lenders to be more efficient, productive and responsive to their customers. Automation of property loan management may appear challenging at the first glance. But business owners need to understand that embracing the innovative approach is no longer a choice. It is a must.
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