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Online in credit processes

I need a loan of PLN 5,000. I go to the app of my bank / loan institution on my smartphone, I do not log in because my image does it for me, the basic products and an icon with the available financial limit are displayed – I click. A new form with a zipper appears, I play with it and in my mind’s eye I see new possibilities. Encouraged by the great-looking offer, I choose PLN 15,000. I keep clicking, something appears… What is it?… 🤔 I let go… and keep clicking. Ooh, new funds in my account. Nice 😊 I get e-mails and text messages with thanks. Great!

An important story…

What we defined a dozen years ago in dark design rooms, with litres of coffee drunk and many brainstorms, crawling with topics such as SixSigma / Opex / Lean, etc., led us towards maximizing sales, defining customer-centricity in the organization and how to maintain it. The slogan “constant optimization” alternated with the word “process.” We knew that the deeper we go into automation, the less jobs the organization will need to support processes, but there will also be new organizational roles – especially in the IT area, which will be leading in the creation and production of products, e.g. online processes. What guided us then gave us the foundations to go through the process in the example above.

Building good practices

Moving to the online world sometimes means the transfer of the “stationary model”, sometimes rebuilding it, and very often building it from scratch. After all, we do not have an Advisor / Analyst who will evaluate the application, accept it in accordance with the legal requirements and expertly assess whether it is worth entering into this relationship. We had to build dedicated models and environments so that what was visible to the client could happen online and in accordance with our arrangements. These guidelines gave us the framework to build an online world in which the client is presented with the most important areas of their interest, but also with the possibility of independent configuration, because we noticed that some freedom in shaping the external form / widgets (graphics, languages, fonts, products on website, photos, background, product pools, etc.) gives the customers a feeling of belonging and individuality. A specific matrix of what should be in the modern front for the client was created.

Breakdown into prime factors

Let’s check how the description, from the customer’s perspective, translates into the language of the business layer of online processes:

I need to take out a loan of PLN 5,000

The preapproved model is additionally verified in external and internal databases and there are restrictions imposed in the form of limits on the client. We only accept customers who have a history with us not shorter than (parameter), have products (x, y, z), income from (x, y, z) etc. There may be many validations and cuts and they can go through the entire organization. The model assigns a global limit or a limit for a specific product / line / customer. In the process of establishing hard product / risk / anti-fraud assumptions, the time comes for marketing and sales. In many organizations, this time is at the beginning, middle and end, and sometimes only partially. Promotional campaigns, chatbots, automatic reminders or a dedicated widget with a calculator are some elements of a modern sales strategy. The extension and personalization of the offer is a continuous process and often also awaited by the client. Campaigns can be renewed, paused and triggered by events such as customer’s birthdays, holidays, etc.

I enter the app of my bank / loan institution on my smartphone, I do not log in because my image does it for me, the basic products and the icon with the available financial limit are displayed – I click

The result of a behavioural survey and meeting the expectations. The service should be available immediately and at any time. Now it is the standard, but the next areas of grouping the access in the field of e.g. FB, Google, etc. confirm our belief that this is exactly what customers expect. The fewer passwords to remember, the better. Of course, if necessary, we can use strong authentication, cross-verification, hiding part of the login / password string, authorization via banks, or secure online payments and many other options for customer / transaction verification. The choice depends on what kind of client we are dealing with (natural person / company), which is possible thanks to the guidelines about the level of risk we are ready to accept, our experience in the market, and most importantly – the form of authorization the client is able to go through, acquire and use in the appropriate way.

A new form with a zipper appears, I play with it and in my mind’s eye I see new shopping possibilities

All price parameters are calculated dynamically, there are dedicated fields for approvals and declarations (if necessary), for example that the customer’s financial situation has not deteriorated. In addition, there is the entire sales and marketing batch which presents the customer the maximum available amount (to be taken alone or with a spouse in the case of larger amounts / limits) and supports it with possible current needs. It can’t be harsh; it can’t be pushy or aggressive. The message in the guise of subtle graphics will work much better, signalling that the offer is temporary, and the larger amount means a smaller %, etc.

Encouraged by the great-looking offer, I choose PLN 15,000

Applause for us. The customer has saved the offer, he can return to it during the campaign period (parameter), and during this time we remind him of his request.

I keep clicking, something appeared… What is it?… 🤔 I let go… and keep clicking. Ooh, new funds in my account! Nice 😊 I get e-mails and text messages with thanks. Great!

We present the client with provisions on the document authorization mode, dedicated statements and information. Documents are already waiting for him along with the authorization methods he chooses. We keep this trace and put it on the documents we keep and treat it as a personal deposit, even those signed online. All product and billing setup are done in the background in the central system. We present its result in the customer’s view along with the repayment schedule. After starting the service, we inform the client about it via remote channels.

Summary of the process

The basic assumption in online credit processes is to exclude a participant other than the client / clients from processing the application. Sometimes, however, we create this ideal situation in a different way, treating the online offer as a channel for submitting applications and the evaluation is already at the headquarters at the moment of signing of the contract. The online channel is also used by corporate clients who, for example, when entering from their authorized website, attach documents for monitoring, order instructions, etc. There are more and more solutions based on a remote process, of which the client is the initiator and executor,  and they are going to stem not only from the product / system assumptions, but also the behaviour and preferences of the customer as the basis for creating their sales vision – not only the credit one, but also an additional one, e.g. VAS. Systems must keep pace with the change and allow for the adaptation of older, historical data (e.g. provisions in contracts) and the processes based on them. Currently, is it easier to adapt systems that are several years old or to buy a new one and migrate data? For these and other questions, please contact us…

After 16 years of creating processes in financial institutions, the time has come for changes and Kuba transferred himself to the IT industry, where the passion for sailing, testing games (mainly from the Battlefield series) and rowing still remains - the ergometer is useful in the garage like never before these days.

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