Are you a Manager of the Loan Department of any financial Institute? Are you an employee?
Probably, Yes. In any financial Transaction, you have to double-check each and every digit and letter. In Loan Department, when the company gives money to the borrower, the company has to check every detail of the borrower. This is a manual task. When comes to processing large amounts of Applications, it takes time-consuming, and also, there is a chance of error.
So, to automate this process, you need to integrate your system’s Intelligent Document Processing Software.
In this blog post, I am gonna show you the 14 Use cases of IDP in the Loan Department and how it can be used to streamline various processes and improve overall performance.
14 Use Cases of IDP in Loan Department
1. Loan Application Processing
Till now, if your company is processing loan applications offline mode, and manually, so, it’s time to automate the streamline the loan application process. IDP software can be used to automate this process. When you integrated this software into your application processing software, this software automatically extracts the data from application forms, including personal and financial information, and next verifies the applicant’s eligibility and creditworthiness and generates automated decisions on loan approvals or rejections. Basically, this process is created through AI and ML algorithms. where, in most cases, no need for human decision power except in special cases. This automation can also provide a more seamless and efficient experience for applicants and as well as Loan Department employees.
2. Automatic Balance Register in Document
First Intelligent document processing software extracts data from the loan documents and calculates the number with its AI and Machine learning technology whether any charges are required or not from the customer. If required, the amount in the balance is automatically updated (credit/debit). This process ensures that the loan register is always up-to-date and accurate, saving time not employees to the loan department and reducing the risk of data errors.
3. Reporting Loan Due Date
IDP Software, like Docextractor, uses its AI and Machine Learning Algorithm to generate automated reports of upcoming due dates for all loans Application. Though, the company has employees check the due date of all applications to notify the borrower for payment, but, as a huge amount of applications, it is very time-consuming for the employee. IDP software does this as a manual time-consuming process automated. After importing the record of all documents, this software extracts the date from the individual application and automatically emails the borrower and company’s official 10 or 15 days before the Loan repayment schedule. This automation really saves time and reduces the risk of error.
4. Auto-checking documents in Retail Asset
With the combination of IDP software and RPA bots, it extracts data from loan documents, such as asset purchase agreements, and insurance policies, and verifies the documents by comparing this information to established rules and criteria. If the software robot found any discrepancy between the given data for extracting the documents and the existing data in the core banking system, then it initiates flags or notifies the employee and a new process to update the same record in the system after getting approval from the retail asset change team. On the other hand, if the software only found the Loan account of the applicants, not saving accounts, it also, notifies the team and processes it after getting the approval.
5. Loan Booking
Intelligent document processing software and RPA can be used to automate the express loan booking process. The software prepares a loan approval template followed by a loan voucher to disburse the loan. It uses this information to automatically generate loan agreements and other relevant documents, such as promissory notes and security agreements. After that, the software updates the collected data through multiple touchpoints in the core banking system.
6. Auto Repayment of Loan
As a Head of the Loan Department, you can use intelligent document processing software to repay loans automatically. Basically, this software uses machine learning and natural language processing to extract and analyze data from loan documents. The software bot identifies the account profile for which the outstanding loan amount exists and then estimates and calculates the proper amount value and date to repayment.
7. Loan Exposure Report Sheet
First of all, IDP Software extracts the data from all records and creates a single file from this report. And, next, calculate the final loan amount due report. After that, the Software robot login the main site and fetch all data related to social security numbers, Loan amounts and massages the data to create a final output exposure Excel file and XML file, and automatically mail to the Head of the Loan Department.
8. Loan Request Posting
Intelligent Document Processing Software uses the Omni Channel Processing method in its core loan management system. The software extracts and processes data from the loan Document using the power of Machine Learning and NLP technology and, next it post loan requests received through the customer service desk.
9. Vehicle Loan Application Auto-Processing
Intelligent document processing (IDP) software is also used to automate the Vehicle Loan Application. This processing speed up the overall process of the Loan Company and Car Showroom. IDP software extracts the required data of the applicant from the Loan Application Paper form, Bank statement and automatically saves the data into the required storage with high accuracy. This can help streamline the loan application process and improve customer experience.
10. Loan Documents Migration
Using RPA and Intelligent Document Processing Software, you can migrate loan document data from one document to another document. The IDP software scanned loan documents and extracts data from the documents and save them to another system. With the help of this, you can Enhance data capture in the process enabling the loan processing department to accelerate the process of converting loan applications into digital assets, with data accuracy and less time.
11. Automatic Fraud Detection on borrower identity
It is very important in the financial sector, to verify the applicant profiles. Especially, in the loan department, it is very important to check the applicant’s identity, bank account, job, or business. In a loan company, by using RPA and IDP technology, you can automatically verify the applicant’s data from various sources and data received with a loan application and next, identify inconsistencies or inconsistencies in borrower identity information. This can help lenders reduce the risk of fraud and improve the accuracy of loan underwriting decisions
12. Loan Funding for Small Businesses
IDP Software and RPA bots, which can Process loan applications for funding the small business extracting data from financial statements, tax returns, and other documents of borrower applications. This automation will help your loan department to make the faster decision of proceeding with the loan to the applicants.
13. Loan Documentation Quality Control
By using Intelligent document processing software, As, Manager of the Loan Department, you can also check the quality of loan documentation using AI and ML technology. The Software extracts individual files from the loan management system and, next automatically detects errors or inconsistencies in loan documents, such as missing signatures or incorrect data, and combines them into one PDF. This automation helps the Manger to check the quality of the overall Loan application of the Borrower.
14. Loan Reconciliation
When the loan department faces a large volume of data from various channels, it is difficult to manage it manually for them. By using the Intelligent document processing software the overall process such are of transaction data, identifying any errors, and generating reports are automatic. This can help lenders improve loan servicing accuracy, reduce manual errors, and save time and resources.