Some decades ago, no one imagined it would be possible to initiate transactions worth millions of dollars from the comfort of your bedroom. Technology has had mostly positive impacts on every industry. From retail, medicine, engineering to banking, technology has made it possible to make giant strides in all sectors in the last few decades. Although there are a few negative impacts with the rising use of technology, the pros far outweigh the con. The lending market has also witnessed tremendous changes over the years, thanks to advancements in digital technology. The transformation has been massive and the effects are quite visible.
How exactly has technology affected the lending market? This article takes a look at this.
Instant loan apps are on the rise
Chances are that you’ve come across a number of ads advertising mobile apps that help you secure instant loans. Even if you’ve been skeptical about them, it doesn’t change the fact that they actually work. Technology has made it possible to secure personal loans without necessarily visiting the bank, going back and forth with paper works, providing collaterals and guarantors, or wasting time while queueing at the banking hall. These apps now make it easier than ever. The great thing about this is that customers are presented with a lot of options when trying to secure loans. Comparing their terms of payment, interest rates, and general policies should help one make the right choice and go with the most favorable platform.
Verification made easier
While it usually took weeks in the past to verify documents and get loan requests approved, it now takes as little as 24 hours on certain loan platforms. Technology has made it possible to cut the paperwork and get details of applicants verified digitally. With digital identifications such as Social Security Number (SSN), Bank Verification Number (BVN), verifying loan application details and evaluating risks now only take a short amount of time. Consumers now get loan requests results as quickly as possible.
Improved risk assessment
Technology has made it possible for banks and lending platforms to assess risks much better. With access to individual credit scores, loan history, and other data, it is now possible to accurately determine whether a loan should be approved or denied. Apart from this, artificial intelligence and machine learning is helping in risk assessment by analyzing behavioral patterns.
Stress-fee loan repayment
With financial structures now fully digitized, loan repayment now happens with the tap of a few buttons. As a matter of fact, it’s even possible to set up automatic payments on the internet or mobile banking platforms. Fintech companies are always on the innovative side, creating solutions that enable hassle-free finance management.
Building better relationships
The advancement in the lending market has helped financial institutions build better relationships with customers in a lot of ways. As it is easy to secure loans, repayment has also been simplified. This has helped build trust on both sides.
Making lives easier
No matter how you look at it, access to quick loans can help one get out of sticky situations. Whether you are a month behind on rent or you need some money to support your business, as long as you have working internet access and a smartphone, getting a loan should be as simple as the tap of a few buttons on your mobile device.