7 factors to consider when choosing a loan management software

Centuries ago, a man called Emmert Wolfe wrote, and we quote, “A man is only as good as his tools“, which still holds true to this very day. As a lender looking to go digital, finding the right technology often becomes a quagmire. Notwithstanding, the right loan management software should offer Secure operations, Multiple channels, Ease of use, seamless loan origination to the collection process, Loan decision engines and blacklist, Analytics and reporting, Customer service support and lots more. 

Choosing the right loan management system is not just a decision; it’s an investment in the foundational tools that can elevate the efficiency and success of your loan business operations. Now, let’s dive into the details of each factor you must consider before choosing an LMS.

Secure operations

When choosing a loan management software, security is paramount because you will handle private, sensitive, and occasionally important financial and personal data. Therefore, any loan management system or software you choose must have built-in security. The software must ensure that your customers’ privacy is respected. Situations such as data fraud that result in a loss of reputation and trust are brought on by these conditions where an LMS compromises your data. Read about how you can combat fraud as a digital lender.

Multiple distribution channels

The most obvious thing you would want to know is this: How will borrowers access your loans? With Lendsqr’s loan management software, loans are accessible to your customers via multiple channels: USSD, Web apps, and Mobile apps. By which they can also make repayments. As a lender looking to scale and thrive in a crowded and highly competitive market, you’ll gain a lot from a loan management software like Lendsqr that can offer several distribution channels to approach various types of borrowers on different channels. You can also learn more on how to boost your loan app rating on Play Store and App Store.

Ease of use

Make sure the loan management software you choose has various built-in features that don’t raise the monthly license fee. Your daily business processes and loan activities should not require coding or the assistance of an IT specialist to be added, edited, or removed from the platform. Basic customization shouldn’t be too difficult for even a novice user. Remember that a complex LMS is hardly appreciated by customers, and rarely do they opt for loans from such platforms. This is why the loan management software you choose should suit the purpose of your business and the business model you opt for. 

Seamless loan origination to collection

From loan origination to repayment, a proper loan management software must make the entire lending cycle seamless for your business. The true essence of automation lies in the ability of the LMS to simplify every stage of the lending process. Without this, the question arises: what’s the need for automation? You’re not making the best use of technology if your chosen loan management software does not automate key processes like loan collection. Find out how Lendsqr automates loan collection using direct debit. 

Loan decision engines and blacklist

Now that your business is all setup, the next thing to worry about is your loan decisioning method. This determines the success of your loan business in so many ways. A loan decision engine assesses loan applications based on predefined criteria and rules that make up decision models. The engine is responsible for screening and scoring borrowers’ to determine their eligibility for a loan. In other words, before you choose a loan management software, you must factor in its loan decisioning tools and blacklist available to help you make good credit decisions. The goal is to lower the chance of human error and the workload associated with manually underwriting each loan. Learn more about the Karma Blacklist.

Analytics and reporting

Customized dashboards that are easy to access and read are one of the most desired assets of a good loan management software. These dashboards provide easy access to information, enabling in-depth analysis of reports such as loan application performance and customer quality. A robust LMS dashboard allows you to navigate real-time data, identify trends, and respond promptly. This ensures that you can stay on top of business matters and enables you to change direction when needed. 

Customer service support

In the early days of navigating the loan management software you choose, you mustn’t be left to figure it out on your own. Continuous and helpful support is needed to integrate fully into the system, and that’s why all of us at Lendsqr are more than ready to hold your hand and help you successfully integrate into the best loan management software there is.

Remember, picking the right loan management software is more than a choice; it’s like investing in a tool that builds how well your loan business runs. The things we discussed, like Security, Loan decision engines, Responsive customer service support etc., are the building blocks for a loan business that wants to stand the test of time in an oversaturated market. Want to try out a free demo and see if we’re worth our onion? Send us a message now at [email protected].