How the Right Data Tools Can Improve the Consumer Loan Experience

Posted by Jeanne Rogers | April 15, 2021

The materials available in this article are for informational purposes only and not for the purpose of providing legal advice. You should contact your own advisors with questions regarding the content herein. The opinions expressed in this article are the opinions of the individual author and may not reflect the opinions of MeridianLink, Inc.

You already understand the importance of capturing and scrutinizing business data for insights into the health of your lending institution. And you’re well aware of the relationship between the health of your institution and your ability to keep clients satisfied.

But did you know that mining your business data for key milestones in the loan process can yield precise, actionable information you can use to improve the client experience?

The best part: you don’t have to make a giant investment in software that serves up hard-to-access data in unfriendly formats in order to take advantage of the data you already collect.

With the right business intelligence (BI) software, you can slice, dice and peer into your loan origination processes in a way that that shows you what you need to know – when you need to know it. In short: You can capitalize on knowing what your borrowers are experiencing while they are experiencing it.

“All data has a shelf life and in financial institutions, the shelf life of data is not long. You need to be able to understand what the consumer is experiencing at the present time.”
– Chris Dumas, MeridianLink Director of Data Insights

All you need are the right questions and a platform that delivers you the answers in real-time. While historical data might help you make better business decisions, it’s of far less value when it comes to telling you, for example, why do half of your potential customers fall out of the process somewhere between requesting a loan and getting one?

Such fallout is an indication that there’s a hitch in your processes. Finding it is simple if you have a system that lets you retrieve and visualize your data instantaneously. What happened? And when did it happen? These are the right questions, but without the right tools, you may be left with only a hypothesis.

Data Mining that Can Reveal the Hitch in Your Processes

“All data has a shelf life and, in financial institutions, the shelf life of data isn’t long,” said Chris Dumas, MeridianLink’s director of data insights. “You need to be able to understand what the consumer is experiencing at the present time.”

When you have that level of insight you’ve got business intelligence that can connect the dots between your fallout and your processes. Here’s an example:

  1. What is happening? Funded loan metrics are down by 20%.
  2. What could account for this? Industry funded loan metrics are also down, but only by 10%.
  3. Where in the process is the problem occurring? Customers are dropping out in the middle of a specific process between approval and funding.
  4. Why is it happening there? It could be taking longer than it should.
  5. How long is it taking? Longer than it takes our competitors.
  6. What happens if you reduce processing time at the exact point where customers are falling out? Fallout declines.

You just moved from seeing a problem, to diagnosing it, to testing your diagnosis, to solving your problem.

All because you could identify, in real time, the exact spot in your process where fallout was happening and what your customer was experiencing right then.

“If you stop at just measuring total volumes of funded loans and fallout, you will never see that,” Dumas says. “You have to look at data more frequently – more than monthly and more than weekly. You have to look at it on a daily basis.”

For that you need a system that integrates with your loan origination system (LOS) and refreshes data automatically, so you’re always looking at what is happening instead of what has happened. This lets you do more than just improve your processes – it provides you with the ability to actively intervene and prevent a fallout.

“If I have data that tells me who is in process right now, how long they have been in process and what that interaction looks like, I can intervene on those specific records,” Dumas says. You can’t do that with data that is a week old. “That’s the difference between reporting and insight,” he says.

Loan Origination Data that Improves the Consumer Loan Experience

Imagine being able to drill down into any of the metrics tracked from your loan origination system for up-to-the-minute visibility into the customer experience:

  • Total requested loans
  • Total approved loans
  • Total funded loans
  • Average days to request to fund
  • Loans funded between specific credit ranges with corresponding terms
  • Status of all loan applications in progress
  • Status, source, funding, credit score distribution, etc. of new programs
  • Drill downs for all of the above, including by branch and loan officer

Transforming Lending Data into Opportunities

Real-time monitoring of your lending data is a powerful tool for improving customer experience.

It’s the link between your data and the answers to the critical questions that drive that experience: What happened? Why did it happen? What’s going to happen next? And most importantly: How can I influence that outcome?

When your loan officers can answer these questions with confidence, they’re equipped to maximize your value to your customers, providing better service and identifying opportunities for improvement and cross-selling.

3rd-Party BI vs. LOS Modules

You have two primary options for finding BI software for your lending institution: third-party BI software or the BI module of your LOS platform – assuming it has one.

There can be drawbacks to each. Third-party BI may have all the bells and whistles needed to handle a wide variety of applications beyond loan origination but may not have the depth you need to improve the consumer loan experience. It also may not do an adequate job of pulling data from your LOS and other systems.

LOS BI modules often have the loan origination depth you need but may not have all the bells and whistles of third-party BI software.

How do you find the right fit? See them both for yourself with a demo and ask a lot of good questions.

Turnkey Data Intelligence for MeridianLink Users

MeridianLink Insight is a turnkey data intelligence system that enables MeridianLink One platform users to pull their data safely into one space so that banks and credit unions can make better and faster decisions that optimize the customer experience, driving revenue growth.

With easy-to-read reports and graphics, MeridianLink Insight offers a superior solution for financial institutions that want to elevate their processes through data intelligence without the need to sink a pile of time and money into expensive R&D or complex IT initiatives. Intuitive design and flexible reporting dimensions enable any user to analyze data, with no programming skills needed.  

Building your data suite is simple. Dashboards can be created in minutes, allowing you to customize data to get the insights you need.

Easily identify, measure, and even predict the success of the different loan offerings that drive revenue and profitability. You can also increase the overall productivity and efficiency of your company with time savings that leave you with space to concentrate on building your business and its core products. The tool is also designed to provide industry analytics that keep you abreast of trends you can use to design solutions and targeted strategies that let you keep up with the competition and the evolving landscape of consumer needs and behaviors. 

Are you ready to take your business intelligence to the next level? Sign up for a free MeridianLink Insight trial today.

Learn More about Meridian Insight's Business Intelligence

Topics: Loan Origination Software, online lending, digital lending, ML insight

Written by Jeanne Rogers

VP, Demand Generation, MeridianLink

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