All businesses seek competitive advantage, and with fluctuating interest rates and still some uncertainty around the economy, banks need all they can get. For Bank of Tennessee, that meant increased turn around speed. Though a smaller business, the Bank was thinking big when it turned to mobility to reach that goal.
By taking loan officers away from the desktop and into the field with iPads, they created a mobile solution that shaves days and even weeks off of loan processing. “We wanted to improve our loan application quality, increase underwriting accuracy, reduce underwriting time and reduce the amount of required training for lenders. There were many challenges ahead of us,” said James Woods, Business Analyst & BPM Developer, Bank of Tennessee.
Over the years, the Bank tried many different methods to increase loan application quality, and despite knowing that technology could improve the legacy paper-based process, finding the right system was not easy according to Woods, who is charged with mobility throughout the organization.
“Past solutions poorly matched our strict loan policies, and could not easily adapt to the needs of our highly-regulated industry. Loan officers are required to collect the right data before submitting a loan application. However, the extensive and constantly changing policies make it difficult for officers to get everything needed on the first meeting with a consumer,” he explained. The manual process required human review of the application, and then a time consuming re-work for the officer if any gaps were discovered.
Woods said that they considered a BYOD strategy when the company migrated from Blackberry, but ultimately decided against it. All devices which contain or access bank information are bank-owned and issued. The sanctioned devices are iPhones and iPads only—"no Android, no jailbreaking"—and all stored and transmitted data is encrypted.
“We take our customer security very seriously, and do not enable a situation where sensitive information is transmitted or stored on employee-owned devices. One breach could be catastrophic. The cost of the purchasing iPhones and iPads carried an upfront investment, but compared to the cost of a breach, we’re saving money in the long run. And since we’re using bank-owned devices, we have full control of the data and can manage and wipe a phone or tablet at any time,” said Woods.
Another reason for disallowing BYOD was consistency in service. Many of the loan officers in the field work in rural areas where connectivity is an issue. Bank issued devices are all on the same, “reliable carrier” with broad regional coverage, rather than having employees all on different networks.
Right People, Right Time
The Bank’s new Consumer Lending Engine, is built on the Appian Platform and guides the loan officer through the process without missing any steps or requesting any unnecessary data from the applicant.
“The application process for each type of loan bears a 1-to-1 correlation with our policies. Extensive training on loan processing and regulatory changes has been replaced with a self-explanatory solution. And, since the application cannot be submitted until it’s complete, there’s no re-work,” said Woods.
This has not only accomplished the goal of significant improvement in turn-around times, but has also created a number of additional efficiencies, such as those in the approval workflow. The previous email-based process required each team member to review and approve in the right sequence. When emails went unread, the loan application was delayed. Woods said, “Our Appian-based system now routes each application through the approval process, reaching the right people at the right time, with reminders to keep each application on a tight deadline.”
Underwriting accuracy has also improved. Guideline documents for lending policies were located in different locations, with multiple documents in different silos. This made it very difficult for the Bank’s underwriters to navigate each policy without missing important details, again creating re-work and creating compliance liabilities.
Ahead of the Competition
Employees are embracing the solution. Woods said, “We now have solid compliance with our lending policies, an easy to use tool for quoting loan rates, as well as more user friendly lending system. Everyone involved in the loan process works more efficiently, and with fewer surprises. “
In addition, loan pricing is now more precise and enforceable. Previous policies and prices were decentralized and difficult to maintain. Quoting a loan is very complex, according to Woods. The officer must consider multiple factors, which all change depending on the person’s credit rating and the type of loan.
The quote must be based on interest rates, margins for the bank, fees, and much more. The new solution simplifies this entire process and guarantees the right quote for each scenario.
“Now, we’re able to price loans accurately and improve our profitability. Also, the rapid turnaround time on loan applications and processing means that our customers get into their cars faster. This provides a competitive advantage against other banks in our market,” said Woods.