The financing requirements of businesses have significantly shifted in recent years. Supply chains are more global and more intertwined than they’ve ever been, and compliance requirements from government and regulatory bodies continue to pile up year after year. Notably, taking out a loan is now typically a much more involved process than it was even just a decade ago. When you add in the complications of cross-border finance and new regulations, maintaining the visibility and intelligibility of a typical loan becomes a very elaborate and slow process, especially when using traditional manual methods.
Modern corporate banking platforms directly address these issues. They allow faster processing, seamless regulatory compliance, as well as much better visibility and risk reduction compared to previous-generation lending management solutions. In this short guide, we’ll fill you in on how these novel corporate process management software helps banks achieve better agility and efficiency when facilitating loans:
Empowered Employees and Clients
Earlier loan management software were generally more dependent on IT teams, especially for customizing loans. A recent trend in banking platforms that addresses this problem is providing more user-side options, right out of the box.
Having more user configurability empowers bank employees and clients to easily make changes without the need for an IT expert. Basic information can also be easily changed by clients through the bank’s mobile platform without the need for IT or client service teams to get involved. This significantly reduces the time it takes to make simple adjustments and allows bank employees to focus on tasks that help increase the bank’s value and market share.
Faster and Easier Loan Customization
Today, custom loans are a part of many corporate banks’ strategies to recapture market share from competitors in fintech and alternative financing. Unfortunately, older generations of loan processing software were not normally as customizable as current ones. Banks using older systems are sometimes limited in the types of loans that they could facilitate or process, particularly loans that depend on the market movements of other financial instruments and commodities. While customization is sometimes possible, this could often be an involved process that requires assistance of finance IT experts.
Current loan processing software considers the needs of banks and corporate clients by offering a wide variety of user-configurable implementations. This reduces the need for difficult back-end customizations and allows banks to quickly offer any loan type. This can be key in allowing a bank to quickly pivot to capture fleeting opportunities in volatile financial markets.
Traditionally, optimizing manpower and onsite computing capacity was a fine balancing act of spending just enough to meet needed capacity. Even taking on just a few major clients would quickly use up capacity, requiring new hires and expensive upgrades. If a major client ends their relationship, the bank may be left with unused capacity that they’d still have to pay for.
Fortunately, better cloud computing infrastructure has made it possible for banks to enjoy optimal capacity at any given time. Cloud-based loan management systems can scale up and down automatically, no matter the transaction volumes.
Hiring for finance IT teams is generally very difficult, and IT personnel availability often presents a practical limit to how quickly a bank could expand its service capacity. As mentioned previously, early loan management solutions were also highly dependent on IT teams, particularly for onsite hardware maintenance. As a result, even if banks had a good loan management platform, there was often no guarantee that they would have the available manpower to use them effectively.
Contemporary loan management software builds on lessons from legacy systems to minimize the amount of work finance IT teams need to do to facilitate each transaction. Newer systems leverage advanced AI, machine learning, cloud-based infrastructure, and out-of-the-box automation features to reduce the labor requirements for corporate loan processing.
When implemented well, using these new solutions can allow smaller IT teams to handle much larger loan transaction volumes in a shorter amount of time. This leaves them more time to effectively handle cybersecurity, database management, and other areas under their purview.
Update Your Corporate Lending Process Management Capabilities
Manual processes and earlier-generation computerized banking platforms are now ill-suited for handling high loan volumes, especially in the current financial environment. Given this, corporate banks with clients who have significant financing needs have to step up with better lending process management solutions.
Choosing the right corporate lending process management tools to facilitate this can be a challenge in itself. If your bank needs a better way to manage loans for corporate and institutional clients, make sure to find a vendor with a technology package that can offer the agility and efficiency benefits described above. To further bring the cost down, you can also work with your chosen vendor to find a solution that will give you all of these benefits right out of the box.