COVID 19 has struck a considerable blow to the global economy. For lenders specifically it has meant huge spikes in credit requests from anxious SMBs, an understanding that their current credit models never expected such a fast economic degradation and a realization that they have a very limited view on current liquidity of their borrowers. The speed at which the World has changed is staggering.
The loan portfolios of lenders have altered more rapidly in the last few weeks than at any other point in time. In 2008, the financial crash caused huge disruption to the financial services industry and many other parts of the global economy. COVID 19 has had much further reaching consequences in a far shorter time frame. Every person, organisation, industry, and country are having to adapt to a new way of working and lots of unknowns.
Working with the very best data available
The tasks of originating new loans, understanding portfolio health, assessing default risk, deciding capital allocation, and devising collection strategies now demand the most current information inputs. This borrower information needs to reflect changes in business financials spanning days, weeks and months, not quarters and years. What lenders now need is a view of an SMB’s cash position as of yesterday not for a previous financial period.
To solve this dilemma, lenders must accelerate moving to a digital customer journey. Using real-time data helps create advantage by improving decisioning and accelerating processes. They must adapt and utilize these digital sources of borrower financials to ensure rapid, accurate insight, which is key to unlocking faster, smarter lending.
Understanding the current financial health of a business by scrutinising the same financial data that the business itself uses to operate is an obvious method for gaining clarity.
Validis and nCino
Validis began working with nCino because there was a clear need for putting the latest, most accurate borrower financials, direct from the SMB’s source accounting package, inside the technology that lending teams themselves are using day to day. Having accurate borrower financials, that reflect the current financial picture (not a financial statement for a previous period), at their fingertips creates huge value and massive efficiency gains for lenders.
Validis and nCino share a vision that technology and data can act as enablers as we move towards a digital economy. We’ve seen this happen in consumer lending and finally there is a realization that similar gains can be made in commercial lending too.
“The Validis – nCino integrated solution makes important progress towards our vision with respect to the collection and spreading of management financials.”
Warren Brown, Head of Emerging Technologies at Northern Bank
How our solution works
Validis and nCino have combined technologies to offer immediate relief to lenders during COVID 19. The solution surfaces accurate, real-time financials inside the very latest lending workflow technology. The lender gets all the financial information they need, direct from source accounting package, at a touch of a button, saving days of manual data collection and preparation headaches.
The technologies are fully integrated. Validis is simply a feature enhancement to the broader nCino platform. The financial data, extracted from an SMB’s accounting package, is digitally spread when it arrives in nCino and key financial ratios and risk indicators are automatically calculated for the lender.
We have removed all the time-consuming data preparation headaches associated with assessing and onboarding new loan clients and monitoring portfolio health.
An unparalleled chance to digitize
As the World grapples with the impact of COVID 19, lenders have an unprecedented chance to modernize their processes and ultimately lower the cost of service of lending to SMBs. Validis and nCino are at the forefront of this journey, offering innovative technology solutions, that will help SMBs access the funding they need to stay afloat at this difficult time.