Lending-Times recently conducted a survey of our readers to find out more about the types of lending services they offer and how they relate to their customers. The following are the results of the survey.
What type of lending services do you provide? (select all that apply)
The majority of readers (55.88%) are in the consumer loan business followed by 36.76% involved in business lending. 17.65% are in mortgage lending while 16.18% are in student lending 10.29% are involved in auto lending. Another 25% identify as alternative lenders, a broad category of lending that includes many types of non-bank loans. Because readers could choose more than one category for this question, the survey results do not add up to 100%.
What is your role within the organization?
The largest percentage of survey takers (25%) fall into the digital sales, marketing, and acquisition category. 11.76% fall into risk, fraud, and compliance occupations, and another 10.29% consider themselves a part of product and technology. The majority, 52.94%, chose “other.”
How do you verify the identity of your borrowers?
When it comes to identifying borrower identities, 37.31% said they do so through data bureau checks. Digital identity verification checks are used by 32.84% of those who took our survey, and 23.88% said they verify borrower identities with a manual review of identity documents. Only 5.97% said “other.”
How do you collect supporting documents for underwriting (for example, utility bills for proof of address, W2s for proof of income, etc.)?
Regarding underwriting practices, 69.74% of survey takers said they collect documents through electronic capture and upload, 25% by email, and 5.26% have borrowers deliver to a physical location. No respondents said they receive documents by fax.
Do you think your current process for onboarding new applicants could be improved?
A simple yes or no response on this question revealed that 93.24% of survey takers believe their new applicant onboarding processes can be improved while only 6.58% responded in the negative.
What stage of the digital transformation journey is your organization at today?
Almost half, 42.11%, of survey respondents said they are a fully digital organization, and the same percentage said they are on track to becoming a fully digital lender. Those just starting out represent 19.74% of our readership who said they are working on a full-digital strategy and evaluating vendors. None of the respondents said they have no plans to become a fully digital lender.
What do you think are the main barriers to oﬀering fully digital lending services? (select all that apply)?
The majority of survey takers (53.42%) said the biggest barrier to offering fully digital lending service is mitigating risk while avoid loan application abondonment. Another 52.05% said meeting compliance without compromising the user experience is the main barrier. Almost one-third of survey takeres (27.40%) said they lack the skills, resources, and budget to offer fully digital lending services. Respondents who said they do not see the value of shifting their loan origination practices to digital channels registered at 9.59%, and those unsure of where to begin came in at 5.48%.
Rank on a scale from 1-5, the value of each beneﬁt in the digital lending process (1 being very valuable, 5 being not valuable).
Our readers seem to value regulatory compliance more than any other digital lending benefit. Risk mitigation followed closely behind followed by improvements in operational efficiency. Cycle time and user experience pulled up the rear.
Do you feel your lending user experience is a competitive diﬀerentiator?
84% of survey takers said the user experience on their lending platforms are a key competitive differentiator while 16% said it wasn’t.
If you already oﬀer digital loans, which of the following options do you provide?
Among survey takers, the digital lending options provided the most include desktop/laptop (52.11%), mobile-optimized website (50.70%), and native app (15.49%). Over one-third (39.44%) said they offer all three options.