6 Ways To Move To An Automated Lending Process

Posted on August 5, 2022

This is a joint post authored by TurnKey Lender and VoPay

Traditional lenders have dominated the consumer and commercial credit markets for decades. Spurned by digital transformation, challenger banks, alternative lenders, and embedded lenders, the lending space is changing radically. This article explores the benefits of moving from paper processes, how digital lending works, and 6 ways lenders can move to an automated lending process, shifting the process from paper to platform.

1) Deliver an automated lending process

Give borrowers what they want; no more middleman. In-house financing options have fast become the way to go for businesses. Embedded lenders lead the pack when changing today's lending practices. The lending process gets a facelift with automation. Technology has become more affordable, intelligent, and flexible. Consequently, offering in-house financing options is significantly cheaper for clients. Moreover, embedded lending means product and service providers no longer need to share their profits with a third-party creditor when their client needs a loan.

2) Make paperless lending part of the customer journey

Up until this point, lending has been mainly under the control of banks and other large-scale institutions. This is due to a heavy reliance on manual processes. Everything from determining borrowers' creditworthiness to the amounts of paperwork involved. This made the lending journey time-consuming and resource-intensive. Hence, more profitable when run on a grand scale.

However, the tides are changing, and e-lending is just as easy as e-commerce, if not even more accessible. The overhead management required to run an embedded lending operation is minimal. Lending software is a cost-effective tool for staff to deploy to create a finance application for many businesses.

One no longer needs the resources or the expertise of a big bank to compete on a level playing field. Credit is woven into the customer's journey instead of a complex side quest a client must undertake. In fact, this growing demand is precisely why the global digital lending platform software market size is projected to reach US$ 20.31 billion by 2027.

3) The digital lending process in 6 easy steps

On a high level, an automated lending process with a loan management platform like TurnKey Lender works like this.

1. It takes you about a minute to create a new credit product with specific terms, interest, fees and schedule rules which your clients will then use. 

2. A borrower applies for the loan through a web interface,  an application programming interface (API) or on-site.

3. The borrower evaluation, underwriting, and analysis happen on the backend, with the borrower receiving a decision in seconds. A quick and easy e-signature finalizes the loan agreement, and the process of disbursing funds begins. 

4. Payment solutions have become a critical component in loan management software solutions. Hence, an API payment integration with a payment processor such as VoPay ensures funds are automatically disbursed to the borrower's bank account. This delivers a quick and easy payout with no human involvement. However, it should be noted that Buy Now Pay Later credit products are the exception, in which case the money is processed later.

5. A borrower is then warned about upcoming and due installments, which can automatically be debited from the account, ensuring on-time payments and a decreased chance of NSF. This all occurs automatically with no human intervention.

6. The business owner can track and analyze all the lending-related data in the Reports workplace.

4) Introduce automation with a modern lending platform

With automation on the minds of many, businesses strive for an embedded finance process that takes on a "set it and forget it" feel. Set it up once and have little to no involvement daily. As illustrated in the 6 steps above, at no point during the loan's lifecycle will a piece of paper need to be printed or signed manually. The modern lending platform solution delivers a resource-saving automated paperless experience. 

The idea of embedded lending is to create a seamless customer journey. A white-labelled system behind the scenes embedded lending delivers an enhanced customer experience. At the same time, providing continuity with an organization's brand look and feel. When integrated as part of applying or servicing their loan, it simply becomes part of the package.

5)  Automation: The vital 7 in loan management software

Loan origination

From start to finish and everything in between. The many tasks that happen between a customer submitting their loan application to fund disbursement or a declined loan. What used to take a full-time staff of originators can now be done by intelligent algorithms.


Modern underwriting automation requires intelligent credit scoring models and numerous data sources to help a business reduce credit risk and improve portfolio yield. Lenders with specific scoring criteria have the ability to add to the system.

Loan decisioning

Insights and deep analytics deliver all the information needed an informed credit decision. Moreover, the system can process the loans with no added human involvement. 


Recognized as one of the most critical areas where automation significantly boosts the business, automation simplifies the operation. Remove the manual and time-consuming processes around schedule management, contact the borrower, arrange grace periods and rollovers, and send out statements. Integrated payment processing solutions have become the way for lenders to simplify the issuance of the loans and disburse them to customers automatically once a loan is approved. Automating collection and recurring payments will dramatically increase organizational productivity. 


For businesses that work with secured credit products, the system should be flexible enough for the users to submit their collateral and for the managers to have everything they need to work with these assets.


For lenders to have an easy way to set up and manage collection and action calendars and strategies.


To keep track of the performance of the business, all the data needs to communicate to the reporting piece of the system in real-time, allowing for portfolio analysis, risk ratings, collection rating reports and other data about their borrowers, loans, and risks.

6) Move Loan management out of Excel and into a lending platform

Even though paper-based processes are slow and costly, many smaller alternative and embedded lenders still use Excel spreadsheets and Word documents to manage loan management. Because of the perceived cost and difficulty of implementation, many will often delay implementing automation until it becomes vital. 

Lenders stick to the old heavy-handed processes like Excel because it's comfortable. Comfortable as it may be, however, this means missing out on the massive business boost and growth potential that can be achieved with a modern lending platform like TurnKey Lender.

Ditch the paper, digital is here to stay 

Let’s face it, time is money and getting money into the hands of those that need it fast is vital. In today’s competitive environment a lender’s survival depends on speeding up the lending application process and all that goes with it. The shift from paper to digital delivers the ability to anticipate and react to market shifts, make better decisions much more quickly, and serve clients better. Hence, a digital and automated lending process will help lenders scale their business and result in a better bottom line. 

VoPay and TurnKey Lender’s integrated technology can help lenders digitize every part of the lending process. Enhance the client journey, eliminate errors and time spent on the manual processes, and add to the bottom line all by simplifying the entire loan process. 

Learn more here. 

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