There’s a cost to everything. Sometimes, we’re willing to pay more for a greater reward. Other times, we don’t see the hidden costs until it’s too late. 

As an inherently risk-averse industry, banking has held out on digital transformation far longer than other sectors. The potential costs are great — digital transformation’s failure rate is famously between 70% and 95%

But is it possible that tech is not to blame as much as the software and implementation processes that come with it? 

The True Cost of Resistance to Tech

Sure, digital transformation is a huge undertaking on the front end. It takes time, money, resources, and patience — but so does any investment.

What many lending organizations fail to realize is that waiting (or refusing) to adopt digital software and processes is just as risky. When lenders conduct business manually, they invite risk into the organization in a number of areas:

  • Inaccuracy and human error. Computers were made to perform repetitive tasks at lightning speed. Humans, on the other hand, require regular rest, fuel, and interaction. When they don’t get it, it results in computational errors, overlooked tasks, and missed opportunities. 
  • Damage to customer relationships. Software will never replicate the warmth and intuition of human interactions. But when employees are wrapped up in manual, behind-the-scenes work, they’re forced to forfeit deeper customer relationships and loyalty. 
  • Shadow IT. If there’s a will, there’s a way. When teams don’t have the software they need, they resort to “shadow IT” or off-the-grid systems that aren’t IT-approved, which present major security and compliance issues that put the company in danger. 
  • Lack of accountability. Without digital loan tracking, leaders and executives are left in the dark about goal progress and performance. And without results and accurate data, they can’t set new goals or grow to reach their full potential.
  • Brand irrelevance. Consumers now flock to savvy, hassle-free experiences that mesh well with their mobile lifestyles. If your brand can’t deliver, say goodbye to customer loyalty and subsequent referrals.
  • Increased security risks. The combination of disconnected systems, legacy technology tools, and adherence to aging procedures opens lenders to security risks that SaaS

5 Opportunities Digital Transformation Provides

Digital transformation is not a fad. It is a new era in lending that unlocks a number of opportunities for business growth. In addition to de-risking the lending process, digital transformation opens your business up to new opportunities like:

  1. Increased Scale

If the pandemic PPP surge taught us anything, it’s that scaling a bank, team, or lending  program requires expandable, dynamic, cloud-based architecture. Having scalable technology means having the bandwidth to say “yes” when bigger opportunities come along. It means actually growing your business instead of simply keeping up. Adopting a digital lending system gives you a clear roadmap for continued business rather than guessing how long spreadsheets and paper contracts will hold out. 

  1. Clearer Transparency

Digital lending tools offer a single source of truth about a loan’s progress so anyone in the company (and even the applicant) can check the status at any time. For example:

In a manual environment…

The customer wants to know their loan status → 

Customer contacts lender → 

Sales must check internally and call the customer back → 

Sales contacts credit/conversion team → 

Sales plays phone tag with the customer to follow up →

In a digital environment, there’s only one step: the borrower simply logs in to the customer-facing portal to check their loan status on their own.

  1. Better Data and Information

When customers provide their business information in a digital environment, it doesn’t feel like a chore. This results in better data input from the start. Well-designed lending applications make it feel like they’re just providing their information, when in actuality, they’re helping build their loan file. This way, you get the best data you need to make better lending decisions going forward. 

  1. Greater Accuracy

When basic information like “business name” is required over and over in an application, it puts the entire process at risk for mistakes, which cost time and money to correct. In a well-designed lending platform, there’s only one field for entering in applicant data like business name, saving you time and sanity. 

  1. Easier Performance Measurement  

Digital lending platforms provide real-time accuracy and dashboards to measure your efficiency ratio, process adherence, and performance against goals by accessing and reviewing data almost instantly. Having these reports not only helps your team improve efficiency and time-to-close going forward, but gives leaders insight into the profitability of their lending operations. 

When You Transform With SPARK

Not all loan origination software is created equal. At SPARK, we’ve built our platform to account for the common challenges newly digital lenders often experience for a successful implementation with the lowest risk. 

For one, our customers have access to the entire SPARK ecosystem, which includes banks and non-banks, as well as fintech and business partners. When you engage with us, you join a community of like-minded institutions who are laser-focused in providing differentiated customer experiences. You also gain access to the deep functionality and relationships we’ve formed over the years with a wide collection of integration partners and providers to help you integrate your data and functions, no matter where you keep them. 

We’re also obsessed with improving and fine-tuning our platform, which includes a full spectrum of products. We support secured and unsecured lending, automated and high-touch processes, conventional and government lending. If it’s for small business, we do it. You don’t have to choose between speed and price — you can get both (whether in bull or bear markets) with a wide array of models to choose from. 

Perhaps most of all, our team is made up of experts from across the industry. They’ve stood in your shoes, on the front lines of lending. They’re constantly on the lookout for changes in policy, regulations, program rules, or government forms — so you don’t have to. Best of all, they have the experience and know-how to counsel our customers on the best ways to take action when changes occur. 

On the contrary, when you partner with other loan origination providers, you miss out on important features like SPARK’s:

  • Low/no-code configurability – No other solution on the market does more out of the box than SPARK. 
  • Product and process expertise – Our community of lenders has charted a course to small business success so you don’t have to. 
  • Design-first software – Our designers are the best of both worlds — those that care about solving lenders’ problems and those that are constantly looking for a better way to do things. 

SPARK’s design-led features, time-to-value, lending volume, and profit growth make it a smart investment for lenders of any size. We know what it means to be a great partner. That’s why we’re relentless about designing experiences (for both customers and applicants) that delight. We take customer feedback seriously, even incorporating it into our product roadmap to help more lenders. We’re there for customers, with hands-on training and helpful service, when they need us most. 

What new opportunities could digital lending unlock for your organization? We’re there to help you turn the key. 

Contact us for a demo of the SPARK platform and an evaluation of your loan origination needs.


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