With the application of Artificial Intelligence (AI) in lending, banks can create more accurate and richer customer profiles. This will help them in their quest to provide satisfying customer experiences. For instance, AI will help them create a credit score in real-time. Banks can also use AI in customer relationship management to improve their services.
Automating mortgage document processing
Automating mortgage document processing on AI-Digital lending platforms can save mortgage lenders time and money. Automated processes can reduce the number of documents that need to be reviewed by a human and streamline the entire process. AI can also streamline the underwriting and approval process. The technology can speed up mortgage lending by 20% or more.
AI is changing the way many industries operate. It’s transforming the mortgage industry. It used to be a manual industry that moved at 9-5 speeds; now, it’s a fast-paced industry that embraces big ideas and advances in technology. Automation and artificial intelligence have transformed the loan production cycle, allowing mortgage providers to make smarter decisions and improve their efficiency.
Creating credit scores in real-time
With artificial intelligence (AI), digital lending platforms can create credit scores in real-time, incorporating a multitude of publicly available and consented data. In this way, they can make smarter underwriting decisions and leverage their assets more effectively. For example, AI can determine whether a borrower is a worthy candidate and the best interest rate for the loan. A new type of digital lending platform can combine this information with a borrower’s own data, generating a fully compliant AI-powered credit score.
With the help of AI, lenders will be able to develop new loan products that will better serve their customers. Credit scoring, a critical business differentiator for lenders, determines whether a customer will qualify for a loan. Furthermore, it’s a critical factor in driving the loan book. Traditional credit scoring relies on rules or manual analysis. AI can break down these processes and enable an alternate credit mechanism, allowing financial institutions to better serve the underserved.
Benefits to banks
Artificial intelligence (AI)-Digital lending platforms allow banks to replace human decision-making with automated systems. These systems adhere to pre-set rules and workflows to accurately assess applicants. This results in a consistent, error-free process. For banks, AI-Digital lending platforms are a major step toward increasing efficiency and maximizing profits per loan.
AI-Digital lending platforms are able to reduce operational inefficiency, which in turn improves the customer experience. Banks can increase customer satisfaction by using AI to automate tasks that employees once performed manually. As a result, the costs associated with manual processes can be drastically reduced. Furthermore, banks can reduce their time-consuming data entry processes, and reduce errors.
Digital lending platforms help banks reach the widest range of potential lenders. Since GenZ and millennials live by their smartphones, banks can reach the most coveted consumers. These generations want convenience and the ability to make financial transactions anywhere. If they have a bad experience with a financial institution, they are more likely to abandon a loan application.
Data points in AI-Digital Lending Platforms
The use of data points in AI-Digital lending platforms is a powerful tool to help lenders understand their customers better. For example, the data points can include customer behaviours, income tax history, and other transactions. Financial institutions have long used data points related to borrowers’ financial health and behaviour to determine their creditworthiness. However, the data points available with AI provide lenders with a new level of insight that gives them a competitive advantage.
The technology that enables AI-enabled lending institutions is transforming the banking and financial services industry. The entire lending process has been digitalised, which means that banks no longer have to rely on old-fashioned due diligence methods to make lending decisions. AI-Digital lending platforms ensure that lenders have ample data on each applicant. In addition, the insights gained from data can help simplify the loan management process.
