This past week I was in Savannah, Georgia for work at a lending conference, and my hotel room overlooked the Savannah River. I was minding my own business when something caught my eye and I looked out the window and saw a massive cargo ship coming down the river. It was pretty amazing to see this ship, towering over 165 feet in the air with all of its cargo, navigate this surprisingly narrow river. I quickly turned my attention to the fleet of tugboats that were helping this monster find its way to the port where it could deliver its payload. The tugboats paled in size compared to the cargo ship, but it made me think about the business lending process and how these larger deals can benefit from the help and guidance of others. To navigate the approvals and the credit policies you may have at your financial institution, successful lenders need to remember that they simply cannot do it alone. Here are five ways you can ensure your commercial lending process is efficient and effective.
First, remove the friction between the borrower and the bank. The best way to remove any obstacles between the bank and your borrower is to go digital. If you are not leveraging an electronic application for your smaller business loans or a customer portal to ease the transfer of files, statements etc., from the client to the bank, then you are simply creating work for your business loan teams.
The next step is to leverage all the data you have internally and make it work for you. I often see way too many commercial lenders who are not taking advantage of a loan origination solution’s ability to consolidate loan and deposit data and to create a holistic view of the relationship for the credit memo. I recall as a commercial lender that the process of creating a credit memo and building out the relationship could take up to two hours…and then you just hoped it would not have to be rebuilt.
Third, apply automation to your lending process. I totally appreciate that others within the bank do not get how difficult it is to manage and maintain those business loans, but that does not mean that you need to be the single point of contact for all things lending. Have your credit policy spend some time with our good friend automation and just automate even a small portion of your process to start. You will appreciate the reduced stress level and your customers will too as they see faster turnaround times.
Fourth, collaborate; and if your tools don’t help you collaborate, find new ones. The entire market is moving toward a collaborative model. From office space layouts to utilizing collaborative office solutions like Microsoft Office 365 or Google Docs, the workforce is significantly more cooperative in nature. Take advantage of these improvements, and remember that more hands can streamline the process.
Lastly, remove roadblocks in your process. Apparently, the Savannah River is not naturally deep and needed to be dredged so that they could push the larger cargo ships up the river. Ask yourself, “What is holding up my loans as I try to move them upstream?”. It may not be as huge an effort as dredging the Savannah River, but it will also have huge payoffs.
So take advantage of these simple changes in business lending to see how you can deliver for your commercial borrowers today.