Digital lending involves the use of online technology in order to complete financial services such as originating or renewing a loan, collecting signatures, or completing a credit analysis for a recent loan applicant. Through digital lending, the process is faster and more efficient for everyone involved.
Digital lending encompasses all of the activities of a traditional financial institution such as loan application, credit analysis, loan pricing, electronic signatures, document capture, and much more. One of the biggest benefits of digital lending is that for financial institutions it improves productivity, allowing a bank to close more loans which in turn increases revenue per loan. Digital lending is also beneficial for customers in that loan processing takes less time and the entire process from application to approval can be done via the internet.
Want to learn more about digital lending? Here’s what you need to know.
Lower Time to Decision
Did you know that the average time to decision for business lending is anywhere between three to five weeks? On top of that business owners and corporates have to wait another three months in order to receive their cash. Waiting months for loan approval and to receive your money is overly antiquated.
With digital lending, time to decision is a thing of the past, and instead, lenders can more quickly make a yes or no decision as to whether or not a borrower’s application is approved. Often times the decision can be made instantaneously. Time to cash is typically less than 24 hours.
The digital transformation of banking not only speeds up the application process, but it also improves customer service and customer experience. There’s nothing better than applying for a loan and getting the money you need in less than a few days.
Fully Digitized Processes
Digital lending has become the expected norm for credit processing. These days almost all large-sized lenders allow personal loan applications to be submitted entirely online. Cash can be received in just a matter of minutes in some instances.
While more complex processes like mortgage lending aren’t entirely digital, the parts of the process that are digitized makes things much less hectic for the buyer and the lender.
A digital process is also efficient and consistent. Consistency in portfolio management and the credit approval process is crucial to ensure that all customers are being weighed against the same standards. It also helps with trend and decision metrics data that may be used further down the road.
No Physical Branches
We all know that banks have weird hours, and chances are that your schedule conflicts with when your local bank is open. A huge perk of digital lending is that there’s no need to visit a physical branch. In fact, online-only banks like CIT Bank allow everything can be done online with a connected device. This means you’ll never have to scramble to get to the bank before it closes. Your phone, laptop, or tablet is the bank!
Low-Interest Rates & Fees
Not being able to visit a local bank branch may seem like a deal breaker, but if the bank offers top notch customer service, you’ll hardly notice the difference. Besides, you as the customer benefit from there not being any brick and mortar locations.
Without physical buildings to maintain, online lenders are more likely to offer low-interest rates and minimal fees. In fact, most online banks have no monthly account maintenance fee or minimum balance requirement. This is a huge benefit that makes banking that much more convenient.
Higher-Yield Accounts
With a high-yield account, you can make your money work for you. If you’ve ever looked at how much interest you’ve earned on your money, you’ve probably noticed that it’s not a huge amount. This is because the national average interest rate is somewhere around 0.10%.
What good is keeping your money in an account if you’re hardly profiting off of it? This is where the importance of a high-yield account comes into play. CIT Bank is well known for its savings account that offers up to a 2.45% APY. Such a high APY is sure to earn you some serious interest, even if you just have a few hundred dollars sitting in the account.
Want to learn more about the accounts available from CIT Bank? If so check out this recent review of CIT Bank checking and savings accounts so that you can find the one that best meets your needs.
Conclusion
You don’t have to be an internet guru in order to benefit from digital lending. If you know how to log into a mobile app or visit a website, you can enjoy the many perks of having an online account. Be sure to thoroughly research your options so that you can find the bank that best meets your needs.