Digital lending: getting the human touch and technology balance right

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Today’s connected mortgage customers demand an Amazon-like seamless and contextual digital experience – across channels. Lenders, for their part, are not only listening but also delivering to customer expectations as they fight for every customer in a highly competitive market. Despite the complexity of lending processes and industry regulations, the entire lending process – from origination and loan delivery to secondary marketing and servicing – is going digital. More than 70% of lenders are either already using or considering using next-generation technology services.

On the surface, investing in end-to-end customer-facing technologies seems like a good idea as it allows lenders to deliver a superior customer experience while cutting costs. But digging a little deeper reveals there is a real danger of going overboard with technology. A Fannie Mae survey found that lenders offering omnichannel customer service may be over-emphasizing the digital experience at the expense of human touch that consumers continue to crave. According to the survey, while 90% of recent mortgage borrowers said that they would like to continue using person-to-person (P2P) communication with lenders in the future, only 50% of lenders thought that P2P communication would be important in the future. The misalignment in customer and lender views raises a red flag that lenders must pay attention to in order to make the most of their digital investments.

How can lenders reach the right balance in merging best-fit technology solutions with skilled people? To do this, it is first important to understand customer segments and their behavioral patterns. The insights can help determine which aspects of the mortgage process are best suited for digitization using technologies such as robotic process automation (RPA), Machine Learning and Artificial Intelligence; and which are ideally left to human resources.

Determining the optimal mix of the human touch and technology

The following broad guidelines can help balance the two resources in order to personalize interactions and deliver the best possible lending experience.

  • Routine, rule-based tasks are ideal candidates for RPA solutions. Automating high volume, repetitive manual tasks enables lenders to drive cost reduction, productivity improvements, scalability, compliance, and faster cycle time. Partnering with an experienced solutions provider can further accelerate the process as it allows lenders to tap into proven expertise in areas such as planning, design, implementation and continuous process improvement. Their skilled automation professionals conduct due-diligence to identify processes that can deliver the highest ROI with RPA, and re-engineer processes using Six Sigma and Lean principles to make workflows automation-ready.
  • Machine learning (ML)– and Artificial Intelligence (AI)-based systems help underwriters and processors review different kinds of application forms and information, allowing them to focus on high-value activities. ML- and AI-based systems learn continually and are capable of combining information from different sources to meet the requirements of specific processes. For instance, they can draw information from different pay stubs to determine annual salary and compare it with the amount stated in the mortgage application in order to validate it. They also flag anomalies early in the lending process by requesting clarifications and information. This means human resources need to be deployed only for exception handling, thereby speeding up the entire lending process much to customers’ delight.
  • Even though digitization in the form of automated underwriting, electronic signatures, and online-borrower portals is accelerating the borrowing process and putting consumers in the driver’s seat, it’s important to remember that a home is the most expensive purchase people make in their lifetime. The unfamiliarity and enormity of the process can make it scary and confusing, especially for first-time borrowers. This makes it crucial to offer human proficiency to customers – when and where they need it. This means that even if you offer an online-borrower portal, it is best to supplement it with knowledgeable staff to help customers better navigate the portal and prevent them from logging off and turning to a competitor, in case they have questions or have trouble using the portal.

At the end of the day, borrowers are looking for the ‘right-fit’ mortgage, not just an ‘express’ mortgage. Lenders stand to benefit the most when they offer human assistance to proactively engage customers and answer their queries while simultaneously using technology to speed up the process. While automation ensures consistency and improves efficiencies, human touch builds trust and loyalty – a perfect recipe for sustained growth and success.

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