Why Loan Management System is the core technology for NBFCs.
A strong core means strong business NBFCs.
While the economy does not seem to stabilize anytime soon, so does the uncertainty of the NBFC sector in India. In an effort to boost the NBFC sector, Union Budget 2020 paved way for it to become a part of the TReDS, an electronic platform to finance/discount trade receivables of MSMEs through multiple financiers. Even though new avenues of business are being opened up for the NBFC sector in an attempt to bring relief, the grounds seem shaky until everything becomes a routine. Adapting to the new market, having dynamic operations for deeper penetration, complying with government regulations, without hampering the core business of lending can overwhelm any NBFC. As tough as the competition already is in this sector, all the companies that fulfill the eligibility criteria are going to jump at first go to make the most of the new opportunities. What we are skeptical about is the balance. The balance between expanding to newer markets, and holding firmly onto the existing one. A successful augmentation not just to TReDS, but to any new market depends on how strong the loan management system, the core business of NBFC is. By strength, we mean how autonomously and efficiently can the lending business operate with minimal human interference if your focus navigates towards new opportunities. If your business runs fine, in fact, thrives when you get your hands off its micro-management, that’s the sign of a healthy business. If not, here’s a basic checklist to judge how competent your core is-
Instant pre-approval & application processing:
With a digital loan origination system, one can instantly pre-approve applicants and credit limit to digitally process applications in seconds, thus shrinking the processing time from weeks to minutes.
Go completely paperless with your document management system. Upload, store, and access all the documents on the cloud from any time, anywhere.
Seamless workflow engine:
The system should have the managerial capability to assign roles and responsibilities at all levels to ensure a seamless workflow that is devoid of confusion, unaccountability, and scope of errors/frauds.
Ability to diversify on the go:
A good loan management system must cater to consumer demands, and create new markets within the lending industry without the bargain in your existing growth rate, and operational efficiency.
Monitor operations without micromanagement:
The system replaces many of the manual processes with agile digital operations, thus increasing transparency in business. Hence, one can know about the complete state of any project or application in a few minutes without actually actively working upon it.
The core of any business needs to be strong for it to diversify and explore new avenues. A good loan management software will relieve you of the urge to constantly micro-manage your lending business, and help you venture out with confidence. It does not just boost the efficiency and productivity of your business, but also makes it immune to maximum human errors and frauds. Not to mention the accuracy, speed, and transparency it brings. If we were, to sum up, all we need to say is a good loan management software is the key to a healthy core of any NBFC business.
If you’d be interested, do check out All Cloud’s Loan Management suite, designed to automate the entire loan operations of your business.
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