Loan Management Archives

Why Is Supply Chain Financing in Demand Among SMBs and How to Leverage It?

SMBs may have found the perfect product-market fit but are restricted from capitalizing on the opportunity without access to timely funds. Small businesses can benefit from supply chain financing by getting access to instant financing and liquidity in this situation. Accounting standards cover the accounting by the supplier for advances it receives under this arrangement.

Financing is required by all businesses, either as an investment or a working capital source. Working capital is employed to purchase the input materials for production, finance inventory, and bridge the time until customers pay their due amount. That’s why access to suitable financing options is key in global efforts to reduce the finance gap for small and mid-size businesses (SMBs).

In this article, you will understand what Supply Chain Finance (SCF) is and why it is in demand by SMBs.

What Is Supply Chain Finance?

In Supply Chain Finance (SCF), buyers and sellers linked in a transaction can lower financing costs and improve business efficiency.

By participating in this arrangement, buyers approve their suppliers’ invoices so that they can be financed by a bank or other outside party, often referred to as “factors.” These financiers provide both buyers and suppliers with short-term credit to provide liquidity & optimize working capital.

Invoices raised by suppliers to larger customers can be paid more quickly through Supply Chain Finance’s unique structure that uses the strength of the buyer’s business as security for the lender, resulting in a win-win situation for everyone.

Buyers are given more time to repay their balances, while suppliers get faster access to their own funds. On both sides, the parties can use the cash on hand for other projects and keep their respective operations running smoothly.

This has the potential to improve the prospects for millions of SMBs who are held back by a lack of fixed collateral and limited offerings. A lack of financial infrastructure, technological capability, resources, and awareness prevents many emerging economies from offering Supply Chain Financing products despite their popularity in many parts of the world.

Example of Supply Chain Financing

Suppose Company A purchases goods from the seller, Supplier B. Under traditional circumstances, Supplier B transfers the goods and submits an invoice to Company A, which approves the payment on a standard credit term of 30 days.

But if Supplier B immediately needs cash, it may request payment, at a discount, from Company A’s affiliated financial institution using the Supply Chain Finance arrangement.

Financial institutions issue payment to Supplier B and extend Company A’s credit term by another 30 days, for a total credit term of 60 days, rather than the previous credit cycle of 30 days.

Benefits of Supply Chain Finance to SMBs

Supply chain financing provides all the answers that buyers and sellers have been looking for, and it provides an opportunity for the growth and expansion of their respective businesses.

There are many advantages of using the Supply Chain Financing method:

1. The Buyer Can Extend the Payment Terms

If buyers need to, they can make the payment terms longer, which gives them a lot more flexibility when running their businesses. Payments to the supplier are being made on time, allowing them to plan for any business risks that may arise so their cash flow is not interrupted.

2. The Supplier Controls the Cash Flow

Because of supply chain finance, suppliers have a lot more chances of getting paid. Due to the supplier receiving payment quicker than normal, they can invest in the business and remain viable since they are getting paid more quickly.

3. Suppliers Get Lower Interest Rates

The financing is done through the buyer in a transaction done via the supply chain financing model. If the buyer has a bigger business (consecutively a better credit rating), the supplier can get a much lower interest rate than they would get otherwise.

4. Encourage Strong Collaborations Between the Buyer & Supplier

In Supply Chain Finance, each party is committed to the success of the other and to strengthening the relationship. In order to avoid losing their suppliers, the buyer wants to do everything they can to help them so that they do not go out of business. However, companies may have to change how they manage their money when economic conditions suddenly shift.

5. Additional Working Capital for the Business

Supply Chain Finance facilities provide additional working capital for the business by complementing the traditional financing options. Business owners benefit from this type of financing by extending payment terms to clients, purchasing more products with favorable terms, and gaining access to credit.

How Can SMBs Leverage Supply Chain Finance?

Supply chain financing increases transparency in the payment processes, making it easier for the buyers and sellers to safeguard themselves against financial uncertainties. By investing in technology and analytics, both companies can maximise the use of their resources and fill in the credit gap.

Supply Chain Finance facilities can be approved within a few business days after due diligence, allowing your business to move quickly between opportunities.

As part of the application process, the finance company determines:

the creditworthiness of the company,
the cash conversion cycle,
net margins,
and net worth.

This helps suppliers gain access to the facility amount and the maximum number of days to repay the invoices.

How Finezza Can Aid Your Supply Chain Finance Journey

Keeping track of the finances can get difficult if you engage in large credit transactions with your customers. This can make it difficult to grow and run operations smoothly.

Supply chain finance offers a solution in the form of tech-based business and financing processes. This results in lower costs and improved efficiency in such a transaction. It works best when the buyer has a better credit rating than the seller and can thus access capital at a lower cost.

Finezza has developed a wide variety of products, including a Loan Management System that helps banks, NBFCs, and other lenders to

Track and manage credit applications
Facilitate proactive monitoring of loans
Create loan documents to save up time
Provides a complete collection management mechanism
Process KYC documents faster and streamline the entire Supply chain finance process

Can Supply Chain Financing Resolve Capital Issues for MSMEs?

Loan Origination System

Small businesses are the foundation of the Indian economy. The micro, small & medium enterprises (MSMEs) sector contributes to about 30 percent of India’s GDP. But despite being the largest employing faction of the country, they suffer from a lack of financial and regulatory security.

Businesses thrive when they have enough funding and a stable cash flow. MSMEs take the hit here as financial institutions are hesitant to step in because of their high service cost and payback risk. Credit risk assessment can be complex for lenders, as there is often little structured financial and historical cash flow information to work with.

For small businesses, the direct result of the credit gap is a cycle of low profitability and stunted growth, making them vulnerable to even the smallest economic changes. Sadly this is the reality for all businesses.

Considering these firms’ importance in our society, if the economy is to boom, it’s important to extend help by offering solutions to combat capital problems. Over 70 % of the funding required by MSMEs is in the form of working capital. Traditional financial institutions are fail to provide needed loan products that work for these businesses, and that’s when supply chain financing comes in.

Supply Chain Financing For Small Businesses

Supply chain financing refers to technology-based solutions that help lower financing costs and boost business efficiency for both parties involved in the sales transaction. The buyer can help sellers or vendors with 100% advance on their invoice.

When the supplier issues an invoice, the buyer confirms it and has it approved by the SCF provider. The lender makes the payment to the supplier, and when the payment is due, the buyer pays the lender. This helps stabilise the supplier’s cash flow as they get paid quickly. The buyer benefits from this arrangement as they’ve managed to extend the payment terms without harming the supplier’s cash flow.

Let’s understand how supply chain financing can be a game changer for MSMEs.

How is SCF Helping MSMEs?

Supply chain financing can help small businesses to grow and expand their venture. Your business will flourish if you go with a direct lender or work with a third-party lender. Here’s how SCF is helping businesses:

1. Smooth Supply of Goods

SCF is a flexible way to finance your business, and it can be an alternative to traditional bank loans, which may not be available or affordable for your business. It enables the smooth flow of goods between buyers and sellers by eliminating the need for intermediaries in the supply chain.

This means more goods can flow through the supply chain, resulting in lower costs for all stakeholders and better customer service for consumers.

2. Available For Early-Age Startups

Because of their credit history, supply chain funding can be a viable option for early-stage startups, as they often face difficulty in easily accessing financing from established organisations.

The wide range of benefits SCF offers to small businesses, including lower interest rates and faster loan approval times, make it the ideal financing solution for growing startups.

3. No Repayment Schedule

MSMEs benefit from supply chain finance as it allows them to pay upfront and meet their urgent working capital needs. With SCF, suppliers can receive reimbursement for bills sooner, reduce unpaid sales, and increase cash available for future investment. This form of loan does not require a repayment period.

Supply Chain Finance (SCF) offers a wide range of products such as Trade Finance, Factoring, Invoice Finance, and others. The term “supply chain” refers to the fact that SCF involves several companies in the supply chain.

4. Increased Liquidity

The Government of India has launched various credit schemes for MSMEs, but they only provide one-time and non-recurring funds. On the other hand, MSMEs need a constant flow of operating cash to meet their day-to-day needs.

Supply chain finance is based on monthly invoicing and helps MSMEs maintain enough cash to meet their working capital needs.

5. Cost-Effective Source of Capital

So many businesses are attracted to SCF as an option for funding as it can secure low-cost financing easily. Before approving that financing, lenders consider the buyer’s creditworthiness, the link length, and the supply chain’s relationship.

It is a more cost-effective source of funding than traditional forms of financing, fostering close relations between buyers and suppliers. Buyers with good credit can negotiate better terms with sellers. As a result, MSMEs’ cash flow accelerates, and sellers can better contribute to the growth of buyers’ business.

Due to significant transaction and integration costs, SCF was previously only available to large organisations. However, with technological advancement, SCF is increasingly becoming popular among MSMEs and lenders to reduce operating costs. The digitization of SCF procedures such as invoice acceptance, invoicing, and e-payments has significantly reduced SCF’s costs, making it feasible even for small transactions.

Wrapping Up

In India, only 10% of MSMEs have access to formal financing, which accounts for about 40-50% of the credit extended to the sector. The rest of the MSMEs borrow from informal financing sources at differential interest rates. The right set of incentives and support can make more MSMEs eligible for formal credit.

Supply chain financing offers many benefits to MSMEs and provides them with the resilience they need to face a new wave of economic turmoil. Educating MSMEs and their anchors about these alternatives is important to streamline cash flow. Many of these micro-businesses need to scale and become big, and the way forward is to bring supply chain financing on stage with small businesses.

Are you looking to streamline your business’s lending procedure? Finezza offers a wide variety of products such as Loan Origination Software and Loan Management Software that helps lenders smoothly run credit applications and process KYC documents quickly.

Get in touch with us today so that you can make smarter financial decisions.

Invoice Factoring – How It Is Becoming the Next Big Frontier for Lending Companies

Lending Lifecycle Management

It is usual for any business to have a long gap between closing the sale and the actual cash flow. Credit sales are necessary for enterprises to increase sales and build customer relationships.

However, it can lead to inadequate cash for working capital and the growth of the business. One way to overcome this situation is through invoice factoring.

In this article, we will provide information about invoice factoring, how it works, and why it is becoming a frontier for lending companies.

What is Invoice Factoring?

Invoice factoring is a business financing option that allows the business to finance slow-paying accounts and meet short-term liquidity needs. In this process, a finance provider (or factor) pays the supplier an initial amount ( 80-90%) of the outstanding invoice and takes on responsibility for pursuing the debtor for the collection of debt.

After the invoice is settled in full, the factor passes on the remaining money to the business, minus a small fee for the services provided by the factor. The cash collected by the company helps in avoiding credit and cash flow problems.

It is also known as ‘invoice discounting,’ ‘debt factoring,’ or ‘accounts receivable financing’ (and sometimes just ‘factoring’). It is easier than a traditional bank loan for a business to raise funds.

Invoice factoring is one of the non-banking funding sources which fills the immediate need for capital for new businesses or businesses without a long track record.

Lenders in this segment accept invoice factoring applications from different businesses considering the current sales volume and the growth potential as a means to approve financing.

Benefits of Invoice Factoring for Lending Companies

Invoice factoring is advantageous to lending companies because the money that they supply to a business is backed by the collateral of the invoice. Suppose the customers of the business pay their bills on time. In that case, the cost of recovery goes down significantly for the lenders, and they can enjoy a better profit margin while collecting payments from the customers.

The lenders simply need to wait out the time period for payments by the buyer to complete the transaction and make a decent profit in the process (with the only exception being the case in which the buyer fails to make payments on time; in such a scenario, the lending company will use its resources to recover the cash).

Benefits of Invoice Factoring for the (Supplier) Businesses

Easy Availability of Cash

An invoice factoring arrangement provides the company with quick access to working capital. This can reduce the risk of missing important payments such as payroll or supplier invoices and increase credibility.

It is extremely difficult for businesses to wait on payments from slow-paying customers, especially if they make up a large part of the company’s balance. Invoice factoring can provide a sense of regularity to the collections process and reduce problems caused by late-paying customers.

Lower Risk of Bad Debts

Businesses that don’t have the resources to recover missed payments from their buyers/clients may end up with bad debts. With the secure option of Invoice Factoring and an accountable third party (lending companies), businesses can avoid this risk and expand operations by bringing in new clients.

Ideal for Seasonal Businesses

Invoice factoring is best suited for businesses that primarily deal in seasons rather than whole-year around. Outstanding invoices can be used to quickly obtain funding for raw materials and make payments to suppliers.

It can help these types of businesses alleviate the cash flow problems arising from slow-paying clients.

Wrapping Up

Several companies often end up with a cash constraint if they don’t have access to traditional bank loans or lines of credit due to slow-paying customers or extended payment terms. Invoice factoring is being used by businesses to secure short-term financing using their invoices as collateral. The lending companies also enjoy a decent profit margin by leveraging their resources.

Finezza has developed a wide variety of products, including Loan Origination Software and Loan Management Software that helps banks, NBFCs, and other lenders track and manage credit applications, process KYC documents faster and streamline the entire lending process.

To implement smooth and efficient processes for your financing needs contact us today!

What Does RBI’s Rate Hike Mean for the BNPL Business Model?

Lending Lifecycle Management

There’s no doubt that RBI’s rate hike is a harbinger of changes in the financial world. During an unexpected policy announcement, the RBI increased repo rates by 40 base points to 4.4 percent in May and 4.9 percent in June. Given the soaring inflation across the country, RBI is expected to raise the rates again. As a result, the Buy Now Pay Later industry, one of the newest but fastest growing sectors in consumer finance, is certainly under scrutiny.

While BNPL might be a new addition to your vocab, the concept has existed for ages. Layaway credit, instalment plans, credit cards, and the khata system at grocery stores are all the same credit tools in different ways. BNPL is the latest version with a tech twist. It allows consumers the flexibility to divide payments conveniently for little or no expense.

How does the BNPL Model work?

With the payment option “Buy Now, Pay Later,” you can purchase without pinching your pockets. Typically, you sign up with a business that offers this service, and that business makes the payment for you.

However, after the lender makes a payment on your behalf, you must make the required repayments within a predetermined time frame. In contrast to a personal loan, most BNPL programs do not charge interest. You have two payment options: a lump sum payment or free Equated Monthly Instalments (EMIs). The lender can charge interest if you’re unable to make the payment within the given time.

The BNPL sector has ballooned after the global pandemic pushed the use of the internet and smartphones to its zenith. Another reason the BNPL found solid ground in the Indian market is low credit penetration. There are only roughly 3 credit card users for every 100 card users in India (globalnewswire).

Thus, BNPL became the “credit product” for users as much as it was a convenience product. The industry has entirely changed due to the flexibility that BNPL schemes provide, especially for younger consumers willing to trade traditional credit cards for more streamlined BNPL schemes..

However, the days of glory seem to be coming to an end. The conditions that drove the industry’s rapid expansion are dying as consumers cut down on their spending, and rising interest rates drive up the borrowing costs of BNPL firms, reducing their profitability.

What does the rate hike mean for the BNPL Model?

BNPL payments are mostly interest-less, and the rates they charge later are minimal. But most companies that provide Buy Now, Pay Later services are not financial institutions and thus don’t have access to huge deposits. So in most cases, companies must borrow these funds to make loans.

But as RBI hikes repo rates and banks chase to keep pace, the interest rates connected with borrowing those funds rise. As a result, it becomes more expensive for them to lend money to consumers, which puts pressure on their profit margins.

BNPL industries earn their revenue from two sources:

1. From Sellers

To avail of BNPL as an alternative payment option, vendors must pay a transaction charge like any other medium at a specific rate. BNPL companies also work to bring more consumer traffic to the vendor. They sell their services, claiming convenience and ease of transactions. This would further convince more vendors to buy into the BNPL service, thus increasing revenue.

2. From Customers

Although it is not widespread, third-party BNPL providers perform light credit checks to prevent lending money to users with bad credit history. BNPL also monetizes its customers by sometimes charging interest or late fees.

The BNPL industry is yet to prove its sustainability. With the repo rate hike, what could change?

The businesses will try to create more friction between customer interaction by introducing checks. These checks will screen its users for creditworthiness. This friction could tip the scales for merchants as BNPL services drive consumers to their websites.

Small BNPL players could potentially run out of business or merge with tech giants to sustain themselves.

Conclusion

India’s BNPL sector sits at a whopping $3-3.5 billion today but could potentially expand to $45-50 billion by 2026 (Decentro). The rate hike is going to impact the sector one way or another. Any lending product risks higher default rates whenever the economic cycle declines. But BNPL firms may have a safe cover in their ability to control what kind of line of credit they offer consumers, typically shorter-term loans.

If you’re looking for a loan management system, you’re at the right place. Finezza offers easy-to-use loan cycle management solutions to level up your financial game. Get in touch with us today.

How Will the RBI’s Ban on Non-bank PPIs Impact the Credit Card Industry in India?

Loan Origination System

The FinTech industry has been evolving quickly over the last decade. 11 of India’s 65 unicorns operate in the FinTech space. The industry is quickly disrupting traditional and established BFSI players. However, the regulatory regime is slowly catching up to technological developments. The RBI has recently released a circular which bans banks from offering credit through a non-bank PPI.

Your Guide to RBI’s Ban on Credit Loading by Non-Bank PPIs

On June 20th 2022, the RBI notified companies offering prepaid payment instruments (PPIs), stating that the RBI’s rules (PPI Master Direction) do not permit users to offer credit services.

The RBI added that if a PPI issuer has been offering such services, they need to stop them as soon as possible. Otherwise, the RBI may proceed with punitive actions as applicable.

In this article, we’ll discuss the ban and its impact on the existing credit card industry.

What Exactly is the Ban on Credit Loading by Non-Bank PPIs

A PPI is a digital wallet or card that allows users to make payments for goods and services. The most popular example is PayTM’s wallet which allows users to deposit money into their wallets and conveniently pay for a wide variety of services (such as mobile recharge, utility bills, etc.)

Currently, many PPI providers are also offering credit or loan services to such users. Usually, the PPI issuer would partner with banks or NBFCs to offer such services.

The Indian FinTech players and stakeholders are confused by the new guidelines. They want further clarity from the RBI and hope the regulator clarifies its position as soon as possible.

To understand the new rules, there should be a distinction between bank and non-bank PPIs. Examples of bank PPIs include ICICI PayLater, SBI Yono, and HDFC Payzapp. In contrast, examples of non-bank PPIs include PayTM, PhonePe, and Google Pay. Therefore, the new notification targets non-banking PPIs, while bank PPIs are exempt from the new rule.

What are the Possible Reasons for the Ban?

A possible reason for RBI’s stance may be to ensure that borrowers comply with all KYC requirements necessary to take credit. For example, the KYC requirements for opening a PPI are much more relaxed than the KYC requirements for taking credit from a bank.

So, in the earlier system, a borrower could simply open an account with a PPI to borrow credit without providing the necessary KYC details that a bank would need.

Further, RBI may be unable to track all lending transactions occurring through PPIs. This is because PPIs are not registered with the RBI as lenders and do not need to follow the disclosure guidelines that banks need to follow.

As of now, PPI providers have been able to issue credit based on the payment capacity of the user. However, with this new rule, the RBI may be aiming to bring such users directly within the cognizance of banks.

Impact on the Credit Card Industry

Industry stakeholders believe that this regulation shows RBI’s intention that core banking activities such as offering credit should remain within the purview of banks. This is because RBI heavily regulates the banks, and they are considered much safer institutions to engage in lending activities

In contrast, PPI issuers are not subject to the same regulations. As a result, it would be difficult to hold them accountable if their lending activity goes south and they cannot return the deposits they have taken from users.

So, we can conclude that this new regulation spells good news for established credit card issuers, banks and credit cards companies such as Visa and Mastercard. However, it may spell trouble for innovative FinTech players.

Critics of the new rule think that RBI’s stance restricts financial inclusion and the movement towards a cashless India.

The Payments Council of India (PCI) has requested the government’s intervention to clarify or revise the new rules. The opinion of the PCI is that PPI providers who fully comply with KYC requirements should be treated on par with banks when it comes to offering credit. The difference should only lie in situations where PPIs do not follow the KYC norms followed by banks when lending.

Further, the PCI contended that PPIs offer greater control over the end-use of borrowed money than lending through cash. This was because PPIs can restrict merchant codes and govern how the money from their wallet is being spent.

Overall, the impact on the existing credit card industry should be positive while emerging FinTech players seek more clarity on the new rules.

Wrapping Up

India’s FinTech industry is on the cusp of large-scale regulatory changes. As the RBI debates the impact of various aspects of the emerging industry, existing players in the FinTech space need to be mindful of their investments amidst regulatory uncertainty.

To know more about the digital lending space, check out our world-focused article here.

If you’re a lending services provider, learn about our services. We offer loan management software which can make your internal operations much easier and more streamlined.

Tips to Select the Right Lending Software Solutions for Your Business

Lending Lifecycle Management

The lending sector has been undergoing a revolution in India and worldwide. Nowadays, in the aftermath of the pandemic, it is no longer optional for lenders to have digital processes for loan applications. It is the norm.

Customers are not patient enough to visit physical branches, fill out several paper forms, and wait weeks for their loans to get processed. Instead, they want the entire process to be online from the comfort of their home or office in a short time.

Even before the pandemic hit, innovative lenders were working towards digitising their operations, and the process has accelerated even harder. As a result, most reputable lenders now have digital lending capabilities.

One of the significant advantages of digital lending is that large swaths of the process can now be automated. In addition, digital lending software has become so sophisticated that loan processing timelines have shrunk from a couple of weeks to a few hours.

All these factors considered, choosing the right lending software solution for your lending platform may be a top priority if you’re a lender. This article outlines five key factors to consider when choosing the right lending solution software.

5 Key Factors to Consider When Selecting the Right Lending Software Solution

Five of the most important factors to consider before choosing a lending software solution for your lending business are:

1. Does it have cloud-based functionality?

When it comes to software, many businesses are confused between opting for a cloud-based solution or using it on-premises (downloading the software on your computer).

However, cloud-based lending software solutions have been known to work best compared to on-premises solutions. Cloud-based solutions are better because SaaS companies are dedicated to developing automation solutions for their clients, providing robust support and process smoothness.

Not every lending institution can afford the cost of developing an on-premise software solution which can deliver the performance requirements. Cloud-based solutions are more cost-effective and can be scaled according to requirements.

Lenders worldwide opt for cloud-based third-party solutions because they offer the cutting-edge technology and timely updates necessary to stay ahead in the lending business. In addition, such lending software solutions offer access-from-anywhere features, the latest security updates, and cost-efficiency.

2. Does it have end-to-end features?

Many software options available in the market today only offer partial solutions to a lender’s problems. For instance, the software may be developed and created only to perform a specific function. This can lead to a situation where you need to use separate tools to manage different aspects of loan processing.

This can lead to more bottlenecks and headaches than it solves because there won’t be any integrated functionality between these tools.

This is why opting for lending software solutions that offer end-to-end services is essential. Such software will help with origination, underwriting, servicing, reporting, and everything.

While the price point of such software can seem prohibitive at first glance, it can save thousands of person-hours in the long run. An end-to-end software will help integrate all the different aspects of the lending process and automate a large part, so minimal manual input is required.

3. Is the lending software scalable?

The best lending software is customisable, flexible, and, most importantly, scalable. So whether you’re a one-person lending company or a multi-national company, the same software should be able to service your lending process automation needs. In addition, the cost associated with the software will scale according to the level at which it is being used.

If your lending company only has 10 clients, you may be tempted to choose lending software that is good for ten clients but does not scale properly. However, this can be a mistake because your business can grow exponentially over the long term, and you won’t want the headache of changing your lending software provider.

Most software solutions are meant for large companies that can afford to have dedicated expert professionals who can manage the software. In case of the requirement to shift to a better version, they have the resources and money to do so.

However, this may not be true for a lender just starting, for start-ups, or small to medium-sized lenders. Hence, it’s best to opt for a software solution with no steep learning curve and proper scalability and a scale-based cost structure.

4. Is the lending software user-friendly?

Software should be user-friendly. For lending software solutions, this applies to both the borrower and the lender. In today’s cut-throat market, a potential borrower will likely leave your website or mobile app if they find the software too complicated. The software is what your lending company puts forward to its clients. Hence, it needs to look and feel the part.

You should only consider purchasing lending software that does not require a too steep learning curve. In addition, the software should be intuitive, and the various features should be easily understandable.

When testing out software, if it takes more than an hour for a lending professional to understand the workings of the software, then it may be too complicated. Nowadays, software UX and UI have been significantly simplified, and you should not settle for anything less.

5. Does it have robust credit-scoring capabilities?

Usually, lenders source credit scores from third parties such as CIBIL in India. But what if a lending software was intelligent and capable enough to source credit reports from CIBIL automatically.

Lending software these days can provide credit scores that get more accurate and quicker the more they are used. Such software uses machine learning (ML) and artificial intelligence (AI) technology to analyse large swaths of historical data and learn from it.

Such credit scores can help a lending company maximise revenue and minimise risk. Such companies can also reduce the cost of acquiring third-party credit scores.

Wrapping Up

An extensive range of leading software is available in the market today, offering a plethora of features. These factors have been curated to help you pick the best one that suits your lending needs. But, of course, the best way to pick a lending software solution is to take it for a test drive and see how well it works.

If you want to learn more about the future of the financial services industry in India, then check out our articles here.

Finezza offers an end-to-end loan management software solution which is quick, efficient, and easy to use. Just some of the features include multi-loan types, flexible repayment frequencies, multi-disbursement, and more. Learn more about our software here.