The significance of Customer App in the lending sector was highlighted during the COVID-19 lockdown in 2019, prompting financial institutions worldwide to embrace digitalization to remain competitive. The challenges posed by the pandemic made it increasingly difficult to cater to customer needs in person, underscoring the importance of digital solutions to stay ahead in the market.
Accelerating Digital Transformation
As lockdowns and restrictions made in-person interactions challenging, financial institutions worldwide were compelled to accelerate their digital transformation to remain competitive in the market. Organizations that had previously invested in digital infrastructure including customer lending apps found themselves better equipped to navigate the challenges brought on by the pandemic. Recognizing the need to adapt swiftly, many financial institutions partnered with technology firms to expedite digitalization efforts, particularly in lending processes. This led to a surge in innovative lending solutions designed to meet customers’ evolving needs.
Benefits Beyond Financial Institutions
However, the benefits of this digital shift extended beyond financial institutions alone. Customers also enjoyed significant advantages, as digital lending application technologies offered:
- ConvenienceÂ
- TransparencyÂ
- Enhanced accessibility to banking services for the end borrowerÂ
Moreover, the broader societal impact was profound, with Customer Apps in lending contributing to the stability of the financial institutes’ business models by facilitating customer retention and promoting mediums of touchless transactions.
Supporting Small Businesses
Amidst the economic turmoil caused by the pandemic, small businesses bore the brunt of financial hardships. To alleviate their struggles, national banks, such as those in India, swiftly implemented touchless customer applications as one of the adoptions in the entire digital lending spectrum. These solutions streamlined the loan application process, providing small businesses with rapid access to much-needed funding.
Key Data Points
Key data points from this period underscore the effectiveness of Customer App in benefiting financial institutions during the pandemic:
- Number of Loan Applications:Â National banks received a staggering 10,000 loan applications from pandemic-affected small businesses.
- Average Loan Processing Time:Â Leveraging digital lending platforms, banks reduced the average loan processing time to a mere 2 days, significantly faster than traditional methods.
- Loan Approval Time:Â A remarkable 70% of loan applications were approved, providing vital financial support to 7,000 small businesses.
- Loan Amount Disbursed:Â A total of $100 million was disbursed to small businesses, enabling them to retain employees, cover operational expenses, and navigate the challenges posed by the pandemic.
- Economic Impact:Â The financial support extended by banks played a pivotal role in maintaining employment levels, ensuring business continuity, and stimulating economic activity nationwide.
Beyond Immediate Benefits
In addition to the direct benefits to financial institutions, digital lending solutions also facilitated:
- Automated loan originationÂ
- Streamlined risk assessment processesÂ
- Enhanced cross-selling opportunities for personalized offerings.Â
This not only helped reduce operational costs but also promoted greater convenience, transparency, and accessibility for customers.
A Nation Embracing Digitalization
As our nation increasingly embraces digitalization, financial services are brought to the doorsteps of individuals, including our elder population. This accessibility ensures that all members of society can easily access banking services and products, further reinforcing the importance of digital transformation in the banking sector.
