eMortgage, The Next Big Thing is Already Here: Make it Bigger
By Nafees Ahmed, CIO, Indiabulls
In last decade, the banking & financial industry dived into innovation wave and transformed its business model through cutting edge disruptive technology. It’s a universal fact that mortgage lending processing cycle is significantly higher than any other type of financial product as core processes are burdened with a lot of manual paperwork, valuations and compliance procedure.
Digital innovation is no more a luxury to be considered rather it is the only way to stay relevant as preferred digital mortgage financiers by customer. So, here is your quick guide to be a digital change agent for future proofing your mortgage business:
- Be a digital leader & understand digital DNA of your customer
- Humanize customer interactions
- Connect the digital dots
- Digital GRC
- Hyper scalability
1. Be a Digital Leader & Understand Digital DNA of Your Customer
Today’s customers are very much obsessed with their mobile screen to do whole lot of online things in their day to day life. The digital demographic is becoming predominant benchmarking in service industry including financial too.
The customers expect everything as simple as online shopping process i.e., fast, easy and convenient. It is a well-known behavioral change across different demographics, which remains a challenge as well as an opportunity. The idea here is not to be clone to such processes but to understand the growing digital DNA of the customer, which gives digital edge to your service offering. Mortgage financiers need to offer a digital experience to borrowers, which is far more relevant to online and real time preference of customers.
2. Humanize Customer Interactions
Unlike other service models, the mortgage financier and borrowers always need multiple interactions during case processing, which can’t be eliminated.
Customers no more feel motivated to queue up for registration, search menus, call for help and wait for response; they are rather looking for everything online with real time response and self-service features, which is more like a machine-to-machine environment.
" The purpose of digital GRC is to have a safe mortgage business in digital ecosystem. "
So, what needs to be reinvented is applying digital intelligence on customer interactions across lending cycle. The purpose here is to minimize and re-design touch point with customer which is as easy as ‘click & proceed’ option.
3. Connect the Digital Dots
The Fintech is there to enable and boost digital program but mortgage financiers need to build a digital intelligence package out of several innovative products which helps in building wow experience. Packaging a complete digital mortgage solution will need a seamless connectors or say ‘enablers’ coupled with each other and convert into a fully automated hyper connected ‘request & response’ digital mortgage model. The most innovative digital mortgage model should have online & pre-filled application form, instant appraisal, automated legal & credit checks along with online mortgage valuation and digital agreements.
Technology is all about converting challenges into opportunity and advantage. KYC Process is one such case where digitization brings ease to financier as well as borrower engagement. KYC is no more an internal process related to mortgage lending rather it’s a global compliance of customer onboarding and transaction processing for all FIs.
Digital KYC (e-KYC) is a paperless, fast, easy and secure alternate to paper based process which enables mortgage financiers for rapid onboarding of customers, better compliance and operational risk management. The last mile in truly digital mortgage model is electronic legal agreement of finance deal. ‘E-signature’ is the most viable solution to mortgage financiers, thanks to the global community for practicing and recognizing ‘e-signature’ as a superior alternate to wet signature.
Forget all the hassles of managing physical notaries, time consuming archival & retrieval and high risk of loss of true copies. To reap the benefits of digital mortgage agreements, the financiers need to acquire robust infrastructure to manage process compliance, digital audits and security.
4. Digital GRC
The purpose of digital GRC is to have a safe mortgage business in digital ecosystem. Unlike traditional paper based mortgage model, the rules, regulations and guidelines for digital mortgage model greatly depend on digital evidences of credit consent, onboarding compliance, audit trails etc. So, half of the battle would be won if digital mortgage package have any leakages in such check list.
Mortgage financiers need to develop counter measures which include third party security assessment with stronger framework like ISO27k, security tool based preventive surveillance, zero tolerance to system trade-off (customer convenience & security compromise), and raising awareness to own employees.
5. Hyper Scalability
The digital mortgage model helps in handling higher number of customer onboarding efficiently with much less head count ratio and lowest turnaround time to close deals. So the direct benefit of hyper scalable model is drastic improvement in per case sourcing cost along with faster onboarding to achieve wow factor from borrower community.