Borrower focus: Serving tomorrow’s borrower

The lending landscape is changing. The lending industry has to finally bring the focus back on the most important stakeholder of the business – the borrower. Why do we...

Snehal Fulzele 17th February 2014

The lending landscape is changing. The lending industry has to finally bring the focus back on the most important stakeholder of the business – the borrower. Why do we say that? We say that because today’s borrower is social, hungry for information, and technologically savvy. He demands personalized services that are convenient to consume but challenging to deliver. Given this trend, it is safe to assume that tomorrow’s borrower will only be more demanding.
So, what can lending businesses do in such environment – an environment of changing regulations, technological advancements, increasing competition and demanding customers? While all of these factors are important and must be dealt with either strategically or tactically, it is borrower-focus that they must prioritize above everything else. Today, the new entrants are targeting the digitally enabled customer segment but the big picture is that they are competing for a larger share of the pie. That means taking business away from the existing large businesses that are resistant to change.What can lending business do to survive?

It may be true that the existing large businesses are slow to change because a majority of their customer base is relatively slower to adopt new technology enabled services from the start-ups. But eventually systems renewal and renovation is on the road-map and the challenge remains in how this is done by the large lending businesses of today. If they wait for too long this can again become a matter of consolidating to a platform that offers lowest risk; a platform that is proven, resilient and stable OR in other words – OLD. Such restructuring can only help momentarily and given the rate of innovation in the new age, it won’t be too long before they have to re-do this exercise all over again.



renew your platforms The lending businesses of the digital age cannot choose to consolidate to a platform of lowest common denominator. They must renew their platform to be fit for the digital age. But while refreshing their platforms, the lending businesses must not lose sight of why they are doing it. It is not to be technologically sophisticated, but to serve the borrower better.

Tomorrow’s lending landscape will be driven by consumerism. This presents a host of opportunities as well as threats to the lending businesses. The biggest opportunity is being able to build customer advocacy by building credibility, trust and improved customer experience. They can do so through thought leadership, higher engagement with the borrower and providing personalized experience to the borrower. The biggest threat is obviously that of the well-informed borrower discarding the relationship with your business and give business to your competitor who offers more promising proposition. This clearly implies that lending businesses pinning their hopes on push-strategy cannot survive and they must focus on delivering the right service at the right time through the right channel to the right borrower.



So how can a lending business be prepared for tomorrow? Well, borrower focus is about the only thing you can control – so don’t lose focus!


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