Drive Higher Customer Satisfaction through Online Loan Origination
15 Nov, 2018
It is crucial for businesses to recognise that the only way to…
COVID-19 is fast-forwarding the digital transformation of companies around the world.
We are seeing appalling personal losses and devastation being created worldwide by the pandemic and its economic impact. But there is no denying it is also acting as a catalyst for change — economic, societal, personal, and corporate — on a scale not seen since wartime, as the authors stated in a recent McKinsey and Co. article The digital-led recovery from COVID-19: Five questions for CEOs.
“We believe the COVID-19 crisis is likely to significantly accelerate the shift to digital and fundamentally shake up the business landscape,” they say.
As we all get used to what has become the new normal, we are having to adjust to new ways of doing business remotely. And in many cases that means re-examining and ramping up plans to ensure our digital systems are adequate, to deal with the new demands being placed upon them.
As futurist Blake Morgan notes in a recent Forbes article, although 70 per cent of US companies had a digital transformation in place or were working on one, most companies were not far enough along to make COVID-19 a non-issue when it erupted.
As companies are finding out worldwide, not only are they scrambling to catch up, in many cases they are doing so on the run, under circumstances that are less than ideal for developing and fine-tuning the new digital systems they need to survive.
Morgan says it’s notable that without the developments in cloud computing, companies would be struggling to share and co-edit documents securely, access analytics and much more, in the current environment. She also observes that not all digital transformations are created equally, noting Harvard Business Review research that the majority of investment on digital transformation in 2018 was wasted when initiatives didn’t meet their goals.
Digital transformation poses particular challenges for the banking and lending industries that will be required to support and empower companies through the COVID-19 downturn.
For example, global pandemic lockdowns pose fundamental problems for a myriad of SMEs that primarily rely on human interaction and physical transactions, as noted during a recent virtual roundtable on Digital Relief hosted by the SME Finance Forum. Leading SME bankers from DBS discussed the problems facing lenders operating remotely for an indefinite period.
DBS’ David Hui explained the bank had quickly introduced a comprehensive set of relief measures in conjunction with the Singaporean government, and had sought to provide short-term liquidity support to its SME segment in a fast, convenient, and digitised way.
DBS has moved the entire credit journey online, from the loan application to its disbursement. The bank has not only sped up the whole process – making new loans available within two days – it has also simplified the documentation requirements by going financial statement-free, requesting only bank statements, notices of tax assessment and credit bureau scores.
The Forum also aired the credit risk assessment problems raised by such a digitisation of the lending process. According to Hui, it has been a delicate balancing act between making credit more accessible to customers, while also satisfying their fiduciary duty to their stakeholders. “While assessing the financial situation of a business, lenders must also be able to draw a clear distinction between chronic and COVID-19-related issues, a sine qua non of the proper deployment of these new digital credit facilities.”
Says Blake Morgan: “Digital transformation doesn’t have to be overwhelming. It’s not something to check off a list, but instead a mindset that becomes part of the organisation’s culture and experience.”
With this in mind we built Credisense. Constructed from the ground up with the newest technologies – including a fully no-code build environment. Customers can rapidly develop and implement credit origination along multiple lines, accelerating their digital transformation. Reach out and let’s discuss your digitization goals.