Photos by Ali Yahyaon Unsplash

Despite the Covid crisis and its detrimental effects on the job market, it seems that happiness at work remains a priority for many employers. It is indeed human nature to wish happiness to other human beings (right !?!). But according to some studies, it is also an efficient way for employers to increase productivity. For instance, employees who report being happy take 10 times fewer sick days[(1)].

So what stops many employees from being happy at work? The characteristics of a rewarding job can be discussed and certainly differ from one person to another.

However repetitive tasks and using tools with poor UX certainly does not help. Fox example, who would happily upload the same customer ID and enter the same ID number into different systems during the same loan application process?

Some startups have solutions to this problem in their domain, as the French company IPaidThat which provides accounting automatization.

90% of employees are being burdened with boring and repetitive tasks which could be easily automated

According to this study by Snaplogic[(2)], these tasks – “which include searching for data, data entry, data processing and analysis, and combining data from multiple sources – are costing businesses 19 working days per year per employee, on average”. Nowadays, it is not uncommon for financial institutions to deal with multiple systems which lead to repetitive tasks. In the case of loan management, this means:

1. A loss of happiness and productivity for employees
2. Delays, complex customer journeys and a decrease in customer satisfaction (more on this here
3. A multiplication of errors which can be the source of unwanted risk, loss of profitability, or even expensive fines

Legacy systems are an accumulation of bricks built over 30 years

Photos by Ali John Barkiple on Unsplash

Indeed, it is not the financial institutions’ intent to complexify the loan application process and burden loan officers and credit analysts. However, over the past decades, the obligations and related tools to grant a simple loan have significantly increased. Know Your Customer (KYC), Anti-Money Laundering (AML) and scoring have made the process much more complex. In parallel, customers demand simplicity, rapidity and in some cases, fully online processes. In B2B lending, the complexity has skyrocketed, as Know Your Business, AML and risk analysis always require more documents and complex processes.

In a commendable effort to facilitate employees’ work and to secure the application and underwriting process, managers of financing institutions have, over the years, added many bricks to their Information Systems. In B2B lending, it is not rare that over 20 tools be used during a loan application and underwriting process only.

When loan officers and analysts should indeed use their brains on meaningful tasks such as understand the competition, build a relationship with a customer, use their knowledge and instincts to navigate through the complexity of a decision process... Instead, their brain is almost fully mobilized entering data multiple times into multiple systems, juggling with different interfaces, going through complex workflows with little guidance and automation.

The technology exists, it is just not integrated

Today, and for a while actually, technology would have been able to automate many tedious tasks, such as checking the completeness and accuracy of customer documents and send gentle reminders, extract data from long documents such as tax returns, bank information and populate it into a loan management system, check existing engagements... There are multiple KYC, AML, Credit Risk analysis solutions on the market, which are widely used. In their own area of expertise, they guide and assist the user. But in a process as complex and consisting of so many tasks, the lack of data integration, makes the whole process Frankenstein-ish, thus the unhappiness!

Stop the patch-up work!

Photos by Ali Tim Mossholder on Unsplash

Changes in technology, customer expectations, regulation have brought many new solutions to the market and it is not over, judging by the number and amount of Fintech and Regtech funding deals. Taking advantage of those innovations, is necessary for happy employees, customers, and investors!

You have an ageing loan management system and have been patching it up with new solutions for years? You know what you need to do

1. Make sure that everyone (customer, partners, your employees) always share the same data. The only difference should be in access rights and display.
2. Rethink processes to make them as lean as possible, automatizing tasks whenever possible, through a lean loan management system or a by connecting through an API, always keeping the same reference data

Wait, this is what you have been meaning to do for years, right? Well ask yourself if your current loan management system will ever allow you to do this (even at a completely unreasonable cost). Complex, inefficient, and hard to maintain Information Systems are not a fatality, all you need is a truly unified, API and digital native system.

1. Snacknation 2019

2. SnapLogic, 2017