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A Guide to Loan Automation

Loan Automation: Get Faster Turnaround Times

Loan Automation

High volumes of structured and unstructured consumer documents keep streaming in; meanwhile, your loans officers are inundated with huge pressures from across the business to improve turnaround times. Paperwork, manual data entry and an inundated call center are slowing down your loans operations, increasing operational costs and keeping your teams from higher-value work such as making sure customers are getting the right level of service. These, plus legacy systems and increasingly complex regulations, are some of the reasons why loan operations are ripe for automation.

With more financial services automation across the industry, it’s time to look at optimizing your loans processes and achieving your business goals with intelligent automation (IA).

This guide explores:

  • Building loan process automation from the ground up.
  • Setting a foundation of innovation you can scale.
  • Use cases where you can apply automation in your workflows.
  • The challenges and benefits of automating loans processes.

What Is Loan Process Automation?

Loan automation can accurately process customer data quickly. A process that might take multiple people several hours to accomplish manually can be done with intelligent digital workers in mere minutes.

From automated loan origination, applications, underwriting and payments – IA provides complete auditability and transparency throughout the entire process. Gain real-time insights into how your processes run to help you optimize work and achieve continuous benefits.

How does loan automation work?

IA, which combines robotic process automation (RPA), artificial intelligence (AI) and business process management (BPM), allows users to configure custom, streamlined workflows, automating those processes that are time-consuming and error prone. You can choose to automate part or all of your lending process – making the entire experience better for your borrowers and lenders.

How does Loan Automation work

Who can loan automation help?

The loan lending process has multiple steps involving several departments. By connecting these steps and systems into one cohesive workflow – and on one centralized dashboard – you can streamline the entire process. And with SS&C Blue Prism’s no-code, drag-and-drop automation solution, it’s easier than ever to start achieving your business goals.

Adopt IA to augment work for:

  • Customer service agents
  • Compliance officers
  • Financial officers and lenders

Now, let’s reimagine a few business processes with intelligent automation.

Document indexing

IA can extract information directly from a document and transfer it into the relevant systems accurately and consistently. It indexes all this critical information, making it accessible to the appropriate parties. IA makes this whole process easier, from collecting e-signatures to verifying data and flagging errors.

Customer service

An AI-powered chatbot can respond to customer inquiries instantly and escalate more complex requests to a human. IA facilitates self-service options for customers so they can quickly update account information, send e-signatures or check the status of their loan application.

Report generation

IA can automatically generate and deliver reports on process performance. This will help your teams identify areas for improvement and opportunities to, for example, increase sales. Identify inefficiencies and measure your results with a centralized IA dashboard.

Who can loan process automation help

See how it works

Watch how you can use SS&C Blue Prism’s intelligent automation platform to reimagine your business loan application processing.

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Why Are Automated Loan Workflows Important?

Intelligent automation allows organizations to streamline disparate or legacy systems to provide reliable and consistent data throughout their workflow. It optimizes every stage within the loan origination process to speed up the time it takes to reach a decision. It also reduces risk and improves compliance – both critical features for the financial services industry.

What are the problems with manual loan processing?

Traditional loan lending workflows are rife with paperwork, requiring manual data entry into multiple systems and applications. This can cause backlogs for your employees and leave them feeling overworked. It also slows down the entire loan applications process, meaning longer processing times that keep customers waiting.

What are the benefits of loan process automation?

Automating your loans workflows can make the entire process more efficient by removing redundancies and bottlenecks, and ensuring your customers get a timely response to their queries and applications. The benefits of automated loan processing include:

Improved customer experience

Reduce the time customers spend waiting for a response to their loan application by speeding up processes such as credit scoring, risk assessment and onboarding. Find customers the best interest rate and process their loans faster with IA, ensuring fair and accurate loan decision-making and driving better customer loyalty.

Better compliance adherence

IA keeps a detailed auditing trail with real-time alerts notifying customers and lenders of missing information or errors in the process. This keeps the workflow moving and reduces the amount of back-and-forth or frustrating oversights.

Lower operational costs

By removing all those hours your people spend manually processing documents, you can redeploy their efforts into helping customers or solving more complex issues suited to their expertise. Say goodbye to rework and duplicated effort with process automation.

Outstanding efficiency gains

Digital workers can help your lending professionals make decisions in the loan origination process by providing all the relevant data at their fingertips. IA handles the basic decisions so the experts can focus on handling exceptions and requests.

Digitized documents

With IA add-ons such as intelligent document processing (IDP), which uses machine learning (ML) to read, analyze and extract data from almost any document, you can standardize all of your business data in a predefined template and automatically update your databases in seconds. IA works securely to ensure sensitive data is protected.

Increased capacity

By automating loan decisioning, you can speed up underwriting and credit issuance. IA assesses borrower creditworthiness quickly and accurately, minimizing the risk of defaults. This can increase loan approval rates while decreasing risk-associated losses.

Reduce customer dropout rates

The fewer barriers it takes to apply for a loan and get credit verified, the more qualified customers you’re going to get. A growing number of financial institutions are using technologies like automation to get people loans faster. IA can help you achieve outstanding results and stand out from the competition.

Reliable risk management

IA allows you to conduct more robust risk assessments and ensure your credit decision-making process is well-informed. This will improve the quality of your loan portfolio and help you offer better value to your customers. Plus, you’ll reduce the risk of fines, penalties and any other costs associated with a loan default.

Who Uses Loan Process Automation?

Financial institutions are using banking automation across functions to streamline work and achieve a higher return on investment (ROI). These functions can include onboarding new customers, credit scoring, loan application processing and customer communications.

Let’s look at specific use cases for IA in loans management.

Who uses Loan Process Automation

Loan origination process (LOP)

Eliminate the lengthy process of collecting documents and clicking through various systems. IA minimizes human errors and improves transparency so your borrowers get a better experience. Between each stage of the loan origination workflow, IA can create more cost-effective and time-efficient ways of working.

Document verification and compliance

IA can verify documents such as identification, income statements and tax returns quicker so your customers can hear their loan decisions sooner. IA can also ensure compliance with regulations such as know your customer (KYC), anti-money laundering (AML) and lending regulations – always working with the most up-to-date information.

Santander funded loans for needy businesses in just two minutes with IA, processing 120,000 loans in three months.

Loan approvals

Automate credit risk assessments based on predefined criteria such as loan amount, income and income sustainability. Digital workers can analyze applicant data to determine creditworthiness, calculate risk scores and assess the likelihood of default, enabling faster and more consistent credit decisions.

Banco Santander sped up their loans processing to get money to small businesses in less than three minutes.

End-to-end loans

IA can manage end-to-end loan servicing tasks such as payment processing, account management and customer communications. It can send reminders, generate statements and handle inquiries efficiently and accurately – freeing your people for strategic work.

A U.K. bank used their digital workforce to automate end-to-end loans processes within ten days, helping them respond quickly to incoming requests and approve 30,000 loans within the first weekend.

Loan underwriting

IA speeds up the risk assessment process so you can make informed loan decisions. Digital workers can perform automatic risk analytics and fraud detection, flagging suspicious behavior immediately. This expedites the underwriting process by analyzing borrower data, assessing collateral value and determining loan terms without requiring human intervention. IA can also identify trends and patterns to improve underwriting accuracy.

Fraud detection and prevention

Digital workers can flag suspicious activities and detect fraudulent applications, helping your organization mitigate potentially costly and time-consuming risks. ML algorithms can continuously learn from data to improve fraud detection capabilities as they continuously run.

Portfolio management

Automation can track loan performance, monitor portfolio health and identify early warning signs of delinquency or default. It can generate reports, analyze trends and optimize portfolio strategies – helping free your people from actually tracking this information and instead enabling them to make decisions on it.

Automate Confidently

With IA, you can streamline your entire loan processing workflow from start to finish. With the better accuracy, security and efficiency provided by your digital workforce, you can scale your operations and achieve even more productivity across your business. Don’t wait – intelligent automation can help you do more with less and sharpen your competitive edge.