The FI Strategy Required for Profitable Consumer Lending

Community and regional FIs they do not make money on most consumer loans.  Consumer personal loans average about $10,000 and are not profitable because of the marketing, underwriting, delivery, operations, compliance and risk costs associated with them.  Yet, while community FIs make these loans every day, they have largely lost this $1.4 trillion service used by their existing customers.  How can they turn serving this market segment into a profitable and efficient line of business?

Seasoned bank executives have had success with a tailored, highly efficient digital strategy:

This configuration is required to provide the customer experience and efficiency.  Digital allows FIs to automate relationship strategies of deposit acquisition with loan acquisition for a faster underwriting, enhanced profitability and improved credit monitoring.  While many today offer an online application, automated decision-ing, and referral to e-sign sites. But just the application process can take 10 minutes on a smart device and involve several pages.  Decisions maybe enhanced in less then an hour, and e-sign may be accomplished in this old assembly-line process.

But today’s expectations are that all should be done in just a few minutes with self-service.  This is what drives consumer use and efficient delivery in-branch or out and turns all your team members into loan producers with simply knowledge of “it looks like you clear here next.”  Providing less for this market segment does not provide the experience to win the customer or drive profitable, efficient delivery.

See how financial institutions are driving results with profitable consumer lending strategy at www.rcgiltner.com