Automation & Open Banking: Enhancing decision-making in lending

Automation & Open Banking: Enhancing decision-making in lending

Accelerated by the impact of COVID-19, lenders and banks are now seeking new ways to streamline the credit assessment and money management processes, with Open Banking and automated solutions taking centre stage.

Shifting consumer expectations  

Now, in a digital age, consumers expect application processes to be fast, simple and easy to understand. Paper-based approvals and manual procedures are deemed outdated and inefficient, often prone to human error and a lack of uniformity.

Aryza Recover has been designed with the consumer in mind, able to automate the management of payment plans and collection strategies, guiding individuals, step by step, through their money management journey. By drawing on Open Banking data, consumers can gain a complete picture of their finances – in an easy to understand format, also offering lenders an accurate picture of affordability and vulnerability. 

The Open Banking revolution 

With lenders now looking to accelerate their decision-making processes, the power of Open Banking is being recognised – bringing advantages for both the business and the consumer. 

What makes Open Banking preferable is that the type of data shared – and those who are granted access to it, is always determined by the user. Consumers will always be asked to opt-in to data sharing on any platform they use and the information shared is also subject to strong security and encryption.

Helping consumers access credit 

A number of different factors can prevent an individual from accessing good quality credit. 

This could be anything from them being a non-UK resident who’s recently moved to the country, or someone who’s experienced a life changing event such a divorce or separation that forced a reevaluation of their finances. Being off work for an extended period due to illness or having children can also impair a person’s credit data, leaving them with a thin credit file and struggling to access the financial support they need. 

By embedding the Open Banking functionality into online application processes, banks and lenders can access potential borrowers’ full financial data and transaction history in a matter of seconds, streamlining the income verification and affordability checks, as well as significantly improving operational efficiency. 

Speeding up affordability checks and income verification

Information available through Open Banking can cover banking transactions, bank statements and credit history – providing a full, accurate picture of an individual’s finances, which is a key step in the process of loan applications.

The financial data shared through regulated providers can be used by lenders and loan brokers to quickly verify income, perform affordability checks and even categorise transactions. As this whole process can be undertaken online, there is no need to collate copies of bank statements, reducing the number of barriers that might slow down or hinder the overall success of the application.

Integrating Open Banking with automation tools

By automating the lending process and enhancing data-sharing via Open Banking, lenders can overcome the challenge of complicated procedures, also able to make better-informed lending decisions. 

Consumers will also benefit from more efficient application processes, enhanced experience, quicker approvals and a product offering better tailored to their individual financial situation, accessible from their mobile devices, PC or laptop – at any time and from anywhere. 

Tools, such as Aryza Recover, can also automate customer communications, sending summary pages to confirm the agreed plans, alerts for transaction errors or missed payments, even SMS or email messages to improve completion rates.

Book a demo to find out how the Aryza software could help your business, here.