When potential borrowers apply for a loan, they must submit a wide range of documents, from identity documents to financial documents such as bank statements.
As the number of loan applicants escalates and the volume of documents grows, lenders face a unique challenge. They struggle to extract raw data efficiently, accurately, and quickly from such a wide range of documents.
This is where Artificial Intelligence (AI)-powered solutions come into play. Fintech companies such as Finezza offer automated data identification solutions that seek to redefine how data is extracted, analysed, and leveraged for speedy growth.
In this blog post, we outline how lenders can use automation to optimise document identification and data extraction.
What are Finezza’s Document Identification Solutions?
Document identification refers to the automated and accurate recognition of a borrower’s document and its various elements. For instance, the software can distinguish between an Adhaar card, a PAN card, Goods & Services Tax returns (GSTR), and bank documents.
Finezza, a cutting-edge lending lifecycle management tool, comes with superior document identification capabilities.
Once a document is successfully identified, the data is extracted, segregated, and placed in relevant data buckets. The software then further analyses and processes the data, enabling lenders to make data-driven decisions.
Finezza enables lenders to automate the entire lending workflow, making it efficient and accurate. The efficient identification of financial and identity documents is an important step in this workflow.
Key Types of Document Identification
Borrower data is captured through a mix of identity-related and financial documents. As lenders scale, they require a mechanism that allows them to automate and scale raw data processing from these documents.
Finezza’s data identification framework leverages technologies such as Optical Character Recognition and Deep Learning to simultaneously power the speedy processing of large volumes of documents.
As a result, instead of one or two minutes, a document can be processed within five to 10 seconds.
The solution can accurately extract and tag data into key categories such as names, numbers, addresses, photographs, and transactions.
Here’s a snapshot of the key types of documents that help lenders verify a borrower’s identity and predict creditworthiness:
Identity-verification Documents
- Aadhaar Card
- PAN Card
- License Plates
- Visiting Card
- Establishment photos
- Electricity bill
Financial Documents
- Bank statements
- GSTR
- ITR acknowledgement
- Balance sheet
Key Advantages of Finezza’s Document Identification Solution
Here’s how the unique benefits of adopting Finezza’s document identification solution directly impact driving revenues and profits:
Boosts Data Accuracy
The automated recognition and extraction of raw data into the right data buckets reduce the potential for errors, duplication, and omissions. Eliminating these potential outcomes increases the authenticity of data. In turn, higher data accuracy translates to superior outcomes across the entire lending cycle.
Versatile Capabilities
Finezza’s document identification solution can recognise data from the full spectrum of a borrower’s identity-related and financial documents.
Furthermore, it can extract data from over 700 types of document file formats.
Email inbox Monitoring, Extraction & Tagging
Potential borrowers often submit documents via email. Extracting this raw data efficiently directly from email can be cumbersome.
However, Finezza’s software can also monitor email inboxes for loan-related data shared via email. Say a borrower shares an email with their PAN Card, electricity bill, and bank documents. The software can directly extract, segregate, and tag the data in the relevant buckets.
Speeds Up the Process
Manual data interventions are no longer sustainable, especially as businesses are inundated with more documents. This outdated approach has a domino effect on the lending cycle, slowing down the underwriting process.
On the other hand, automating the process translates to quicker turnaround on loan approvals. This is a valuable capability, especially for businesses looking to scale quickly and efficiently.
Reduces Costs
Manual data identification and extraction processes consume a significant amount of human capital. Earlier, lenders would need to hire data entry operators to do the work.
Today, technology can take over, and lenders can run with lean teams, which brings down costs. They can also redeploy their team members to more strategic tasks.
Enhances Risk Assessment
Finezza’s data identification and extraction process accurately segregates all transactional data into specific inflow and outflow categories and sub-categories.
Thus, lenders can account for every transaction – from EMIs and salaries paid out to revenues earned and penalties paid. This mechanism helps lenders get an accurate picture of a borrower’s cash flows, risk profile, and creditworthiness.
Easy Integration
It’s possible that lenders already have well-functioning lending management software. If this is the case, they can easily integrate Finezza’s data identification solution into their existing software. Finezza can step in to monitor the integration end-to-end.
Ability to Scale Quickly
There is a major credit gap in the Indian markets. For instance, the credit gap in the Micro, Small, and Medium Enterprises (MSME) sector is estimated to be to the tune of $ 530 billion.
Ambitious lenders looking to fill the credit gap need to act fast. Lenders automating critical processes such as data identification can capture credit-deprived markets quickly and efficiently and expedite growth.
Higher ROI
The ultimate aim of automation is to drive higher return on investment (ROI) for businesses. By automating the data identification and extraction process, lenders can benefit in several direct ways connected to the bottom line.
They can bring down operational costs. Businesses can drive revenues by processing loans swiftly and capturing more market share.
There’s also an opportunity to reduce the potential for risk and loan fraud by ensuring data accuracy. These steps collectively contribute towards raising ROI for lenders.
Key Takeaway
Document identification solutions by lending technology businesses such as Finezza are transforming the entire lending work cycle. They help lenders improve the accuracy of functions such as risk assessment, fraud detection, and collections. Lenders can become more data-centric in their operations, leveraging well-processed data to make critical decisions.
Finezza offers comprehensive tools and solutions to manage your lending portfolio. Our end-to-end lending management solutions are trusted by brands like ftcash, Hiranandani Financial Services, gromor Finance, and UC Inclusive Credit, to name a few.
Finezza’s intuitive bank statement analysis software is geared to analyse bank statements with speed, and accuracy and detect potential fraud.
Book a demo to know more.
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