NBFCs are promoters of financial inclusion within the economy. They constructed a solid bridge to achieve lending success within the deprived communities. Thanks to their gigantic contribution to the economy, NBFCs are now a significant part of the financing ecosystem. RBI’s Report on Trend and Progress of Banking in India 2020-21 also reflects similar sentiments.
An NBFC loan management software keeps any NBFC company afloat by supporting its loan process operations. Irrespective of the NBFCs’ size, the loan management software manages the loan process via multiple functional modules.
This article will see the nitty-gritty of a befitting loan management software and what modules it must have to function seamlessly.
Top 10 Modules You Should Look For
Here are some must-have modules should you plan to consider investing in loan management software:
1. End-to-end loan management module
This module handles all sorts of loans and the process involved. It starts from loan origination, including proposal submission, follow-up, verification, onboarding, and more.
This module also covers loan management and closure, including EMI presentation, bounces of EMI, closure, loan transfer, NOC certificate, and more. Therefore, we can safely say this module involves the end-to-end lending process.
2. Customer management module
This model looks after everything ‘customer’. It helps collect and create a repository of customer information across various customer touch points in the loan life cycle. Some features of this module are part payment, foreclosure, waivers, write-offs, loan revision, dynamic loan schemes, and more.
3. Accounting module
This module keeps you financially accountable through account management. Your preferred loan management platform should come integrated with account management with extended financial management functions like journal entries (automated or manual), cash or accrual-based double-entry accounting, integrated chart of accounts, automated tax configurations, mapping fund sources, liabilities, and assets, and more. This process helps you maintain your books by keeping the balance sheet and income statement updated at all times.
4. Reports and dashboard
A software that gives instant access to information via detailed reports collated in a dashboard should top your list of considerations, especially regarding lending management software.
The platform should include collecting, organising, and accessing the data anytime. Check how interactive the dashboard view is and how detailed the reports are.
We suggest you check the number of reports the software allows you to create, category reports related to parties involved in the loan life cycle, supported formats, and its reporting capabilities.
Reports also help you follow your company’s KPIs and gain deeper insights into business areas to foster improvement. So this is an aspect you’d want to consider before going forward with a particular lending management software.
5. Mobile app
With the accessibility that mobile apps bring, this is another module you should watch out for, especially for your employees: mobile accessibility.
The mobile interface makes it easy for NBFCs to trace their collection agents based on GPS and update payments in real-time. It also caters to the field offers, which offer lending services at doorsteps for enhanced customer experience.
6. Collection management module
This is one compulsory module NBFC companies should never overlook. This module is meant to keep the collection process in place relatively efficiently. Check for automated collection workflow, powerful payment management, staff performance, and collection repositories.
Another essential feature to look for is – real-time payment updates. The best loan management software would give you one view of collection requisites like date of disbursements, repayments, outstanding arrears, interest rate or tax changes, adjustments, and write-offs.
Some add-ons you can look for are easy payroll and payout features. This is essential for NBFCs that manage the payroll system of a vast employee base. This is in the company’s best interest as it allows hassle-free loans and payroll management in a single tool.
7. User and branch management module
This module covers branch management and user access management explicitly. When we say user management, it refers to the employees of the NBFC, the ones using the software.
So, this module should cover information like employee Id, working hours, salaries, contacts, etc. Also, check the module for multi-language support, multi-channel support, paperless processing, automated process, and more.
8. Legal module
You should also consider the legal facets of the process involved in financing. Some great features that fall under this category are loan recall notice, case filing, case hearing, loan settlement, loan transfer, and more.
This module looks after any legal obligation you have or the ones that may arise because of several circumstances. The best way to cope with the legal side of lending is to stay prepared.
9. Operations, security and credit management module
This module covers operations and other steps required in the loan operations, such as PDC intake, sanction letter, disbursement, and more. Check for this module that completes the loan operations process.
Speaking of the credit management module, some of the features you need are – KYC, credit score, field investigation, collateral, technical collateral, legal collateral, deviation and approval, recommendations, documents uploads, and loan approval.
For security, you must look for features that safeguard your and your customers’ data. This includes checking system access, data storage, backup, and more.
10. Other APIs
Another feature that supports your business operations is third-party APIs. For example, you can integrate APIs such as credit bureau, NSDL, UDAI, Social Score, Insurance, Bank, and more. This would give your company easy and instant access to multiple integrations.
The Bottom Line
Investing in the right NBFC loan management software makes or breaks your loan process. With the right features, you and your employees can enjoy effortless deployment, save time and costs, easy integration, robust reporting, and more.
Not only does effective loan management software benefit your employees, but it also makes it easy for the customers. This, in turn, helps you scale your business. Many more modules are involved in a loan management system, and you should closely refer to them to use them best.
Need an effective loan management software solution? We got your back! Finezza’s loan management software can cater to your NBFCs’ needs. We can help you efficiently streamline the entire lending process. Optimise your lending process with Finezza’s powerful and state-of-art loan management system and earn a chance to move ahead in this cut-throat marketplace that is so crowded.
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