You organized your deals in your lending platform. You set up your processes. Everything is running smoothly and you have an invaluable resource at your fingertips. Data. The question is, how can you put it to work?
If you think about it, everything we do creates some form of data. Every website we visit, app we open, or email we send shows something about us. It isn’t just big businesses that are using data these days. Even small companies have found ways to improve their processes using data.
So how can you leverage data? Do you need to bring in a third party to interpret it or can you go at it alone? How do you get started using your data?
If you feel overwhelmed, don’t stress. Data is your friend, and it can lend powerful insights into your lending’s potential. To make it easier, we’ve listed five steps to help you get started collecting and applying your data.
1. Choose the right software
The key to pulling insights from your data is the right software. Your lending creates a monumental amount of data, and without the right tools, you will miss out on the information you need to make smarter decisions. No human can process all of this data alone. This is where machine learning comes in.
Much like “big data,” machine learning is another term that many use and few understand. What machine learning is is a form of artificial intelligence. It serves to processes and learn from this raw data so it can perform a task.
In this case, make sure you know what you need when you look for your data processing and analytics software. It’s good to have an understanding of where you’ll be drawing your data from. You could start with your CRM or fintech lending platform, for example. Then, look for software compatible with the tools you already use. How can you evaluate the software? That leads us to the next tip.
2. Ask the right questions
Without knowing what questions you’re asking from your data, you will not get your answers. Always make sure that you have your goals in mind so you can understand what kind of data and software you need.
For example, are you looking to reduce the time you’re spending assessing risk? How much time is it currently taking? What are the steps, and how many people does it take? These kinds of questions will make you think about what the “right” integration is for you.
3. Plan broader goals
When you know what you’re looking for, you can start to use your data to get you farther than you may have imagined. Plan distinct, actionable goals for where you want your lending to be. Do you want to take on more deals? Then your data can show you what is currently stopping you and how to improve. Do you want fewer errors? Your data can show where they’re most often made (and even take a stab at why).
While it may be tempting to choose small goals, your competition is aiming higher. Plan for tomorrow, not for today. Successful lenders pay close attention to their industry and forecasts. This is how they know where to target their efforts and measure them with data.
4. Measure progress with your data
Once you’ve got your goals planned out and your software set up, it’s time to measure your progress. Let’s imagine that you’re trying to cut time spent processing transactions. Are the numbers lower now than they were to start? If not, take a deeper look and see what part of the problem remains. It’s not a matter of if you can achieve what you’ve planned; it’s a matter of how.
Modern loan management software offers features that make data digestible. These include visual dashboards, custom reports, and custom notifications. Use them to your advantage. If the numbers look off or if you don’t see what you need, reach out to their support center. They can give valuable tips you can tailor the software to your business.
5. Automate your processes
Once you’ve got the hang of your software, you can apply what you’ve learned to other parts of your business. Track the health of your deals with common indicators from past transactions. Standardize your processes by ensuring that all your staff uses the same flow. Better yet, set up automatic prompts to ensure that no deal is missing information.
Keep in mind that your goldmine of data isn’t limited to your actual loans. You can apply the same method anywhere in your business. Remember, work smarter, not harder.
Don’t let the buzzwords catch you off guard. You and your team can learn and apply big data, machine learning, and analytics to help even the smallest of businesses. With the right software, questions, and support, you can automate your way to success.
President and founder of Fundingo’s loan origination, underwriting, and servicing solution with 10+ years of experience in the alternative lending space and a deep understanding of the operations within this industry. An innovative leader that has built a solution recognized by Salesforce CRM for making an impact within the lending industry by helping companies make faster, better decisions.