Our most recent webinar featuring Jim Marous, Owner and Publisher of the Digital Banking Report and Co-Publisher of The Financial Brand and MeridianLink Sales Engineer, Jerod Nace, covered best practices to help banks and credit unions compete with digital lending leaders.
Here’s what you missed:
Banks and Credit Unions are Not Meeting the Needs of Digital Barrows
Today’s digital lending industry is seeing a lot of disruption. This is changing the way competitors compete for business and the way consumers view businesses. For example, if we look at online retailers like Amazon, most people value speed of delivery and ease of use in purchasing over the price of the item. This type service is setting the standard for all other digital experiences.
Part of the disconnect in terms of digital lending is that the needs of the consumer are not being met. Most consumers feel comfortable and probably have applied for a credit card online, but are not given that opportunity by their local bank or credit union. An astonishing fact was pointed out by Mr. Marous, only 34% of survey respondents within the 2019 Digital Banking Report stated that their financial institution gives them the ability to apply for a loan on their mobile device. This is problematic as consumers have the ability to do just about everything from their mobile device.
The Online Application Process
Another important item to note is that consumers may be able to apply for the loan through the bank or credit union’s website or mobile app but are unable to finish the application process. 48% of those who gave their members and customers the ability to start a loan application online are unable to complete the entire process and 69% of those who start the process on a mobile app are unable to complete it. An interesting item that was noted by Mr. Marous, is that throughout the years financial institutions have stated that within the next year, digital lending will be improved but it unfortunately does not occur. This functionality is often not prioritized and financial institutions need to realize that in order to provide a great digital consumer experience to members and customers and stay competitive, they must make investments in their digital lending processes.
There are three major areas of opportunity, or those items that are holding back banks and credit unions from allowing their customers and members to start and complete a loan application from a digital channel. Those items are signature, ID verification and documentation. Often times when consumers are prompted to complete items in-branch, the original source of the application will not be stated as mobile or web. And in some instances they will be propped to answer the same questions. This is not an optimal experience and can appear misleading in some cases.
With new non-traditional approaches to lending emerging, which provide consumers the ease of digital applications and simple to use features, banks and credit unions need to make sure they’re keeping up with these digital lending leaders. Application Portal is the ultimate solution that makes applying for a loan or deposit account, simple and quick. Giving banks and credit unions the opportunity to provide their members and customers with loans, credit cards, new accounts and much more in just a few minutes from their mobile phones, tablets and computers.
Graph Images Source: 2019 Digital Banking Report, The Financial Brand