10 ways Robotic Process Automation can improve the Loan Origination Process

Updated On : August 2019

The lending scenario has turned complex today with rising customer expectations, compliance needs, and competing technologies. Customers look for fast, seamless and hassle-free access to loan products and services to suit their specific needs and are accessible at their preferred time, place and channel. Lenders, in turn, are using different tools and processes to improve efficiency, offer quick approvals and earn customer loyalty.

These challenges can be met by Robotic Process Automation (RPA), which can be used in the lending process in the form of lending management automation. RPA or Digital Automation fulfill the customers' needs and also helps lenders improve the loan origination process and offers them newer opportunities for growth. RPA is the use of software robots that help automate business tasks, like document filing and routing, email reminders, notifications, data synchronizing, etc. It can be integrated with Enterprise Automation platforms to build workflows and automate processes from start to end.

Automation allows streamlining of disparate systems, provides consistent and reliable dataflow for any stage of the loan origination process, and accelerates the overall processes while delivering strong audit and control benefits.

From the origination to the underwriting and post-closing processes, an automated loan processing system can capture data from paper documents electronically, index and route them to the appropriate system. Workflows for certain procedures can be set up for repeatable, consistent processing and for faster turn-around times. Manual repetitive processes, otherwise performed by loan operation staff can be automated.

An automated loan processing system can also help lenders with

• Following several ever-changing regulations
• Ensuring accountability within the processes and sub-processes
• Operating within organizational silos to find needed information without making it a frustrating, time-consuming chore
• Maintaining compliance to reduce risk exposure

Let's look at ten ways how Robotic Process Automation can help lenders gain a competitive advantage in the loan origination process.

• Faster, better defined, more reliable processes with RPA Workflows. An RPA platform could improve your processes and automate tasks like data entry, document routing, task assignments, or email notifications and speed them up
• Faster Loan Processing. Firstly, automating tasks saves money internally by cutting back-office overheads, reducing human errors, and enabling more loans to be processed and disbursed in lesser time. Secondly, it also brings the same benefits to the customers and helps to meet their expectations
• Customer Portals for Loan Applicants. Enterprise automation makes it possible to provide customers with portals, which can be configured and customized in the most efficient way to suit the needs of the customers
• Enhanced Visibility into the Lending Process. With workflow automation, the lending process becomes electronic and makes it easier for data to be collected at every step. Searching for documents to find out its process status is easily done with a document management system. Analytics gathered from processes enable lending firms to make better decisions and thus gain an edge over the competition
• Simple and Easy Lending Audits. Automating lending-related documents and processes increases the ability to respond swiftly to risks and execute future compliance guidelines. It will be easy and simple to give pinpointed access to auditors to be able to view electronic files and processes, without disturbing other team members
• Electronic Signatures for Faster Loan Processing. An electronic signature allows users to sign electronic forms online. Electronic signatures reduce paper and mailing costs and most importantly, save time by giving a distinct time-to-close advantage
• Better Customer Experiences. Robotic Process Automation improves customer management and customer satisfaction by delivering convenient, personalized customer experience in a very timely process. The inconsistencies and delays of manually collecting financial data and other mandatory customer information can be mitigated
• Higher Data Accuracy. With Robotic Process Automation, there would be higher data accuracy, as automation would remove the errors arising from human intervention
• Fraud detection. In an automated system, frauds are detected and exposed more efficiently than human findings
• Enable Compliance. Digital automation lessens the risk of data compromise, which could happen, with manual manipulation of customer information. With automation, the risk of non-compliance, data compromise or data loss is drastically minimized

It is important to remember that the goal of automation is not to replace the existing loan origination system or related quality systems. RPA implementation involves front-end integration without any changes to the existing IT infrastructure. The best tools always work with the existing technology towards improving the quality and speed of the information that is entered.