The Allure of BNPL: Unraveling the Benefits for a New Financial Era
Buying Loan Management Software: Advantages and Who It’s for [Build or Buy Guide]
When you buy a loan automation solution, you’re not just purchasing software.
You’re gaining ongoing support, continuous adaptation to market changes, and peace of mind regarding regulatory updates and software complexities.
(This post is the 2nd chapter in our series ‘Build or Buy? An Executive’s Guide to Choosing the Right Approach to Loan Management Software’)
Vendors typically deliver these solutions via the cloud as a SaaS (Software as a Service) solution, offering additional benefits such as scalability, no upfront capital expenses, fast time to start, pay-as-you-go pricing models and easy access.
While the allure of building a custom solution can still be tempting, there are compelling reasons why buying a pre-built, yet customizable loan automation platform might be the more strategic choice for your business.
Let’s look into those.
Advantages of Buying Loan Management Software
1. Faster implementation and time-to-market
One of the most compelling reasons to purchase a loan automation solution is the speed of implementation. Pre-built solutions are designed for rapid deployment, often taking just weeks or months to configure and integrate into your existing systems (CRM, core banking, etc).
This is in stark contrast to building a custom solution in-house, which can take years of development, testing, and refinement.
For businesses seeking to capitalize on market opportunities quickly or respond to evolving customer demands, a faster time-to-market can be a decisive factor in choosing to buy rather than build.
2. Access to vendor expertise and support
When you partner with a loan automation vendor, you gain access to a team of experts with specialized knowledge in software development, regulatory compliance, security, risk assessment, and lending best practices.
Their expertise will help you navigate the complexities of lending automation and ensure your solution is optimized for the best outcomes and satisfied customers.
3. Regular updates and maintenance
Buying loan management software is like subscribing to a streaming service. Vendors offer ongoing support and maintenance, providing updates and new features, bug fixes, and troubleshooting assistance as needed.
This keeps your lending operation running smoothly and up-to-date with the latest industry trends and regulations.
4. Cost considerations and budget predictability
When you buy loan automation solution, you know exactly what you are paying for – a predictable subscription or licensing fee. This makes budgeting easier and more transparent.
Additionally, the faster time-to-market can translate to quicker revenue generation, potentially offsetting the upfront cost.
This is in stark contrast to building a custom solution which often involves hidden costs, such as ongoing maintenance, upgrades, and the need for specialized IT personnel.
Ideal Business Types for Buying Loan Management Software
Buying lending automation software is particularly appealing for businesses that:
Value speed and efficiency
You need a solution implemented quickly and don’t have the time or resources for a lengthy development process. This is ideal for businesses under pressure to go to market quickly or respond to changing customer demands.
Prioritize proven solutions
You prefer a tried-and-tested platform with a track record of success in the lending industry. This is especially beneficial for businesses that are risk-averse or have limited experience with software development.
Seek scalability and flexibility
Your business is growing, and you need a solution that can easily adapt to your evolving needs, whether it’s expanding into new markets or adding new products and services.
Lack specialized technical expertise
Building a custom solution requires a dedicated team with specialized skills. If you don’t have those resources in-house, buying is a more practical option.
Operate within a defined market
Your lending processes are relatively standard and fit within a well-defined market segment. This means a pre-built solution can likely meet your needs without extensive customization.
Did you just nod? If so, buying loan management software is for you.
Not sure yet? Then you can check successful stories of businesses that bought a lending automation solution.
Successful Stories of Buying a Loan Management Software
- Check out how Globe Telecom transformed 87 million mobile users after automating their lending process.
Globe Telecom, the leading digital solutions provider in the Philippines, serves over 87 million mobile users. They needed an automated loan management system that could keep pace with their massive scale.
TurnKey Lender helped Globe integrate a seamless cloud-based automated solution with their existing infrastructure, allowing them to process thousands of loan requests instantly.
Plus, borrowers could easily access loans through familiar channels like the GlobeOne app, SMS, or even Facebook.
Established way back in 1847, National Iron Bank is New England’s oldest private bank and a key player in the mortgage lending scene. Despite its rich history, the bank recognized the need to modernize its lending processes to stay competitive.
So, they partnered with TurnKey Lender and automated their entire lending process with a Cloud-based solution. This streamlined their workflows, seamlessly integrated with existing systems, and supported the entire loan lifecycle.
As a result, National Iron Bank went fully paperless, launched a digital portal for borrowers, and expanded services efficiently without hiring more staff.
Most importantly, their decision to buy a solution rather than build one helped them implement it quickly, making it accessible to customers within weeks.
Read the previous part on what exactly is loan automation, or jump to the next chapter: Building Loan Management Software.
Prefer to read the entire guide at your own pace? Download it as a PDF version.