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Customer expectations have changed. The modern customer demands convenience, and they are more than willing to find an alternative if their current provider does not fulfil this requirement. As technology has evolved, the options customers now have in the world of finance have multiplied.
With so many companies offering financial propositions, the need to be competitive is greater than ever. As a result, lenders are under immense pressure. They must adapt or it's likely they'll struggle to survive.
With the arrival of the Instant Economy, smaller lenders are now effectively competing with traditional banks for customers; competition now comes in all shapes and sizes.
This new ecosystem has been created by legislative changes and Open Banking regulations that have levelled the playing field. Borrowers now have more options than ever before.
As competition in the lending sector multiplies and diversifies, it’s clear, not all will survive, and so it’s essential lenders with ambition fulfil a few key criteria in order to genuinely remain competitive.
Give customers the finances they need, when they need it
In the Instant Economy, it’s imperative lenders can offer finances to their customers quickly and conveniently. The ability to evaluate customer applications rapidly and disburse loans at speed is key to competing in the future. With this in mind, it makes sense for lenders to develop platforms that work 24/7 and that can quickly identify a customer’s spending profile, allowing for fast decision making around loans and rates.
To achieve this ambition, lenders need to move away from manual disbursement processes to adopting a real-time API-driven loan disbursement approach. Those who have modernised are already reaping the benefits, offering loans to their customers within ten minutes of application, and differentiating themselves from the competition. This immediacy is giving modern lenders the edge in the market, particularly over traditional lending institutions.