Customer preference drives innovation and transformation in banking, but regulatory requirements drive significant changes in financial institutions’ processes and policies. Today, therefore, it is important to deliver lending decisions with speed and compliance.
Whether your credit union has a growing commercial portfolio or an already established one, having the right tools to automate and standardize your operations can help drive more accurate and timely decisions – and exceed auditor requirements.
A recent study of credit union executives reported commercial lending was expected to grow more than 10X over retail lending.
Here are the five top ways a commercial loan origination system (LOS) can help you grow your bottom line and meet evolving compliance and regulatory requirements.
1. One source of truth
Submissions are the main source of information for auditors. Within a LOS, all key financial information, from risk rating to debt service ratios and rental income, is captured in one location, making it easy to access and export for auditors.
2. Time savings
Automating processes is good for regulators and your lending risk. An LOS has many time saving features that automate key processes such as data input and ratio calculations, saving lenders time, reducing human errors, and increasing overall lending efficiencies.
3. 360⁰ view of the clients
Lending decisions are based on multiple factors including the member application, ratios, and financial statements. By centralizing access to member information, lenders can view all information in one place, helping make an informed, repeatable, and traceable decision.
4. Standardization
Organizations can come to depend on an individual or team’s institutional memory and expertise to support lending operations rather than written documentation. Process standardization and automation provided by the LOS as well as the ability to centralize onboarding, training, and knowledge transfer documents within the LOS creates traceable, scalable and transferable processes that can be audited and applied across teams to ensure your credit policies and processes are being properly enforced.
5. Consistency of outcomes
If you’re reviewing loan volumes and metrics from one team, you want those same data points provided by all teams. By implementing uniform approval processes and portfolio management across all lending operations, data formats, and reporting metrics, you create repeatable and measurable control processes. These implementations create consistency and reliability in the information and data used by your institution during loan origination and adjudication processes, further mitigating risk.
Having the right technology can benefit your credit union’s lending operations in numerous ways. Built on more than 20 years of lending experience, Valeyo’s commercial loan origination system enables your institution to make effective lending decisions thanks to extensive features and functionalities that improve operational efficiency, increase automation, enforce credit policy, and bolster compliance.
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