Solution Sheet
Profitable Small Business Lending Improve Profitability by Making Your Small Business Lending Scalable & EfficientImprove Profitability by Making Your Small Business Lending Scalable & Efficient
Lengthy on-boarding time and high costs associated with Small Business Lending are comparable with high value commercial loans. Several challenges stand between Banks and efficient small business lending. Some of these challenges are:
Why Banks Struggle with Small Business Lending
Lengthy on-boarding time as it can take days or weeks for due diligence checks, further aggravated by manual hand-offs
No defined process for small business loan renewals and modifications
Delayed processing of small business loans that do not fall under policy guidelines
Unstructured sub processes such as third party appraisals, fees management, etc.
High volume of small ticket sized loan applications that entails similar due diligence in terms of time, effort and cost as a high value loan applications
Tough to manage cost vs revenue ratio
Manual management of- customer data, credit & risk analysis, credit approval note creation and coordination with decision makers, manual check on central bank compliance policies.
Manual management of documentation, collateral management, covenant monitoring and referral policies
Difficult customization of lending process due to diversity of small businesses
Small Business Lending is a complex process. The risk associated with small business loans is high and assessing creditworthiness of small businesses is often a challenging task due to information asymmetry. These loans are often associated with "piles of paperwork", high turnaround time and massive transaction costs. These reasons deter Banks from venturing into the Small Business Lending space and emphasize the importance of an efficient lending work flow tailored for small business loans.
Overview
Optimizing Customer On-Boarding
Customer On-Boarding is a critical step in the lending cycle. Despite digitization, the customer on-boarding process remains a time and cost intensive affair. In order to mitigate this and to improve customer experience, banks need to pro-actively strategize a simplified and seamless on-boarding experience.
Customer On-Boarding
Automation and digitization of end-to-end small business on-boarding and loan origination process with a Configurable & Unified Platform with seamless integration capability to core systems is the key.
Data Management
Managing customer data is critical for banks. A majority of banks still struggle to consolidate customer data with fragmented information scattered across disparate applications. Banks need to simplify the collection, storage and utilization of customer information.
Unified View of Customer
Given the patchwork of applications that banks have, they do not have a single repository to store customer information. This leads to poor customer experience as customers have to repeat basic information every time they transact with the bank. Moreover, there is a dire need for a single view of customers as banks tend to maintain siloed customer information across products availed and applications.
Regulatory Compliance
Compliance is central to on-boarding customers. Banks need to do due diligence checks to ensure KYC, Anti-Money laundering, FATCA and other regulatory norms compliant. Compliance keeps changing and most banks are still stuck with hard coded rules which makes it difficult to make faster transition to new norms. The result of course is manual hand-offs which substantially increases client on-boarding time, specifically for corporates and small businesses.
Multi-Channel On-Boarding
Customers today expect a digital on-boarding experience, one that is device agnostic and seamless. They want faster transactions, self-service portals, transparency and meaningful engagement with their banks. Banks need to provide a centralized on-boarding experience to customers that offer a unified view of customer information can offer customized product offerings.
Automation Benefits of Customer On-Boarding Process
Enhanced life-time value of customers
Reduced dependence on manual processes, saving time and costs
Minimized data errors and unified view of customers with centralized data storage
Contextual customer engagement in real time
Competitive service offering
Newgen Small Business Lending solution automates and streamlines the end-to-end on-boarding process and lending cycle for the full range of small business loan types–from prospecting and origination to underwriting, disbursement and servicing. The solution provides a simple and easy to use interface for the capture and analysis of small business loans. It is built on Business Process Management framework to enable credit origination, approval and monitoring in a paperless and electronically driven workflow environment.
Newgen Small Business Lending accelerator is a packaged application for automating small business lending that comes with configurability, thanks to the underlying BPM framework. It brings best of both worlds (buy vs build) that seamlessly enables a bank to meet 100% automation requirement and connects with all external systems to act as a unified lending automation platform.
Newgen's Small Business lending automation software allows banks to differentiate themselves from their competitors. No matter how different, how complicated process a bank follows, the solution seamlessly automates it.
Newgen Small Business Lending Automation Software
CoreBanking
WorkingCapital
Other SmallBusiness Loans
TermLoan
RealEstate
SBA
Treasury CRM BureausOther
Systems
Solution Accelerators Ready-to-use, tried & tested, domain-specific business
application components for each loan segment
Configuration LayerProcess - Forms - Workflow - Rules - Masters - Dashboards - Document Management
Document Management System
Branch Web Portal Third Party AgentsMobility
Seamlessly on-board small business customers from any channel
LOAN ORIGINATION SYSTEM
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EG
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TIO
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INT
EG
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DOCUMENT MANAGEMENTImaging - Document Upload - Version Management - Sharing - Retention
BLACKLIST
FRAUD DATABASE
WATCHLIST
CREDIT BUREAU
ONE OBLIGER
DEDUPE
COLLATERAL DATABASE
NAICS
Prospecting and Lead Generation - Efficient lead management and handling of cross and up-sell opportunities
Pre-qualification - the solution facilitates pre-qualification of small business loans
Credit Scoring - Easy credit scoring with bare minimal financials and data from the borrower
Straight Through Processing - Straight through processing of loan applications with a Credit Decisioning engine that lies atop the solution.
Credit Analysis and Underwriting - Comprehensive credit assessment tools that take into account financial information, ratio analysis, account conduct and pricing
0360 Risk Management - Complete due diligence through Peer Group Analysis, Trade Checks, real-time pipeline view, automated rules & standardized processes
Document Management - Generate Loan Package with small business loan documents and security instruments in pre-defined bank specific templates
Collections and Provisioning - accounts and linked accounts Efficient management of delinquentthrough incessant follow-ups and history logs
Solution Highlights
Streamlined Small Business Lending process with Newgen solution
Prospecting
Underwriting
ApplicableData Entry
Customer Acceptance &
Selection
CustomerSign Off
Decision & Approval
Documentation
Generation ofOffer Letter
LoanBooking
Servicing
Disbursement
Review
JACK HENRY
SALESFORCE
EQUIFAX
LASERPRO
CORELOGIC
FIS
FISERV
BAKER HILL
CREDIT DATAMART
WORKFLOWAutomated Routing - Exceptions - Escalations - Decisioning - Tracking - Reports
Origination
With Newgen's Small Business Lending solution, each small business loan type can be easily managed from end-to-end i,e. from prospecting, document capture, digitization, origination, approval, closing and funding to servicing. The solution ensures paperless processing of credit applications with a robust built-in document management system. Further, the solution ensures seamless adaptation of unique loan products through its embedded rules engine.
Disburse Loans at Accelerated Pace
Lead Management
Lead Capture Lead Assignment
Tracking & Follow Up Lead Conversion
360 Degree Customer View
Customer Accounts Relationship Details
Group & Sister Concerns
Service Request Management
Origination
gnic i v r eS���
Document Checklist
Product Setup
Pricing Setup
Application Processing
Collateral Capture
Integration with External Credit Bureaus
Offer Letter Generation
Appeals
Closing Documents
Funding
Account Monitoring
Account Profitability
Covenant Monitoring
Portfolio Monitoring
Business Activity Monitoring
Dashboards
Reports
Change in Pricing
Change in Collaterals
Rescheduling
Restructuring
Review Renewals
� Financial
Spreading
Credit Analysis
Scoring and
Rating
Risk
Management
Credit Automation
Memo
Generation
Decision and
Approvals
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Faster Customer On-Boarding - Deliver a seamless on-boarding experience to your customers to enhance their life time value. Newgen's Small Business Lending solution provides a seamless omni-channel experience, ensuring ease of use, convenience, intuitive assistance and auto-KYC verification which significantly decreases on-boarding time of small businesses
End-to-End Risk Management - With methodical portfolio monitoring, automated tracking of collaterals and covenants, comprehensive reporting and standardized lending processes, leading global organizations are realizing the benefits of end-to-end risk management delivered by Newgen Small Business lending solution
Greater Selling Opportunities - Gain better insights into high profile accounts to enhance profitability, create cross-sell opportunities and underwrite loans competitively. The system ensures all touch points with the customers are streamlined to power strong customer relationships
Unprecedented Operational Efficiencies - Eliminate duplicate data entry, reduce error rates and policy exceptions, enable dynamic staffing, business rules driven underwriting and documentation, and streamline approval cycles for faster transactions. The resultant speed creates a distinct competitive advantage in a fiercely fought marketplace
Compliance and Process Standardization - Close monitoring of process Service Levels across the lending lifecycle–from initiation to disbursement ensures compliance and risk optimization. The system ensures that all loan documents and covenants are tracked and reviewed automatically in accordance with credit policy and compliance. It allows generation of custom reports for increased oversight
Sales & Marketing
IncreaseProfitability
ReduceBusiness Risk
IncreaseBusiness Agility
IncreaseCustomer Satisfaction
BusinessValue
Business Benefits
SOLUTIONS FOR BUSINESS PROCESS & CONTENT MANAGEMENT www.newgensoft.com
About Newgen
Newgen Software is a vendor/provider of Business Process Management (BPM), Enterprise Content Management (ECM),
Customer Communication Management (CCM), Document Management System (DMS), Workflow and Process Automation
software. The company has a global footprint in over 60 countries with large, mission-critical solutions that have been deployed in
Banks, Insurance firms, BPO’s, Healthcare Organizations, Government and Telecom Companies.
Newgen's Quality Systems are certified against ISO 9001:2008 and Information Security Standard, ISO 27001:2013. Newgen has
been assessed at CMMi Level3.
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