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While credit origination is considered as a very customer-centric process, the credit servicing part that comes afterwards is usually considered as a purely operational, back-end process. However, substantial added value and competitive advantage can be reached by a more customer-centric approach during this credit servicing lifecycle. In an earlier blog "Are credits not too commoditized?" I already mentioned that banks should come up with new value-added services on top of a running (active) credit, like more flexible ways of reimbursing the credit, automatic suggestions to rewrite a credit, etc. These value-added services mean that banks should foresee much more customer contact-points during the loan lifecycle.
Today most credits already allow several servicing requests, but most of these servicing requests are handled manually (usually not supported by the online banking platform, but manually inputted by a branch employee or even someone in the mid- or back-office). Some examples are:
Apart from the aforementioned requests initiated by the customer, there are also a number of servicing actions that take place (automatically) according to the credit contract. These can serve as interesting contact points with the customer for financial optimization and cross-selling. For example:
Independent of whether a service event is triggered manually or automatically, this event should offer an attractive and compelling user experience and should preferably be handled fully online.
This means following features should be foreseen:
Such digital credit servicing not only reduces operating costs (by automation and focus on self-service), but also improves the relationship with the customer, which has a positive effect on the sales of other credits and financial products. Clearly, digitalization and excellent user experience in the credit origination process are the highest priorities, but once these objectives are reached, banks should also tackle the credit servicing requests.
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