What particularly bothers SME customers with corporate loan applications
The services offered by many banks in the corporate lending business are not very digitized. In our current market research study “The ideal application process for corporate loans – what SME customers really want”, we identified the resulting factors that are mainly responsible for poor customer experiences in this potentially attractive business segment.
In principle, the SME customers we surveyed can very well imagine processing loan applications completely digitally and show very little reluctance towards such a process design. When it comes to implementation, however, the following challenges need to be solved for banks most of all. These are particularly often perceived as annoying in current practice.
Laborious disclosures for credit checks
The first major pain point is due to the provision of documents in order to comply with regulatory disclosure requirements for carrying out credit checks. Various factors play a role here. The volume of required documents and information from various areas of the company is high. For companies, this means internal research and coordination efforts as well as frequent exchanges with external partners, such as tax advisors. In addition, banks demand a high level of detail, which can result in lengthy question-and-answer processes.
Long processing times of the banks
Even if all documents relating to creditworthiness are complete, it usually takes a while before a credit decision – whether positive or negative – is made. The perception of excessive processing times varies. The bureaucratic document requirements on the part of the banks are also reflected in the corresponding processing time. The human factor also plays a role: if responsible bank employees are absent or on vacation, time-critical investment projects can be delayed.
Low transparency in the process
In the course of application processes, key questions often remain unanswered for corporate customers: What stage are the parties at? When can a decision be expected? Clear answers to these questions would significantly improve the customer experience. In addition, the credit decision is often a “black box” in the event of rejections. A non-transparent rejection is particularly frustrating after a long waiting period and a considerable amount of work.
The implication for banks: Removing these major pain points and barriers in the application process will have a positive impact on competitiveness. This is because the willingness of respondents to apply for a loan from a bank with a more convenient process would increase significantly.
Do you want to significantly boost the digitalization and automation of your loan application processes in the corporate lending business? Our BANCOS Onboarding software solution can support you. Find out more online here and feel free to contact us if you would like individual consultation or a personal demo.
