As a bank valued in your community, you enjoy a wide customer base and hold a wealth of data—the question is: are you leveraging it to its fullest potential? According to Accenture, banks that use an array of monetization techniques can expect to see their revenue increase by 1-2%, at the very least. The bottom line? It’s an accessible opportunity to gain additional revenue.
Regardless of the systems you use, your database is rich with insights, such as the kinds of businesses that consistently seek credit, what separates the credit-hungry from the credit-worthy, the reasons why most of your loan applications are denied, and more. Extracting insights like these—and using them to inform smarter decisions—can help you monetize your databases. One segment ripe for monetization is your small business customer base. Often given short shrift in traditional banking models, increased lending to small businesses can boost your revenue with very little incremental cost.
Here are 3 ways that your bank can easily monetize your small business customer database.
- Consolidate disconnected legacy systems
Many banks still operate across multiple, disparate systems. Your data is there, but your ability to act on it—by making a loan offer or performing other related tasks—lies in another system, run by another team. Consolidating everything onto an agile, accessible, and configurable platform is the first step towards capitalizing and acting on all of your data. Luckily, there are more digital solutions to choose from than ever before. Whether your current systems are cloud-based or on-premise, an integrated, end-to-end digital platform is key to connecting the dots across your customer data—and laying the foundation for monetization.
- Automate costly manual processes
The cost of processing small business loans—from evaluation to underwriting to funding—drains manual time and resources, with the costs often outweighing any potential profits. Introducing a digital loan origination channel and increased automation—features included with many end-to-end digital solutions—reduces the time it takes to process a small business loan from hours to minutes, and virtually eliminates the need for manual tasks by your loan officers. It’s the speed and convenience that your small business customers want. According to an HBR article, more than 60% of small business owners would prefer to apply for loans entirely online. Not only can automation generate more leads, but it allows you to finally fund qualified applicants that you may have previously turned away. With automated rules tailored to the small business loan applicant, you can lend to more credit-worthy small businesses.
- Engage with customers you already have
With more of your small business loan applicants now viable for loans, you can capitalize on your trove of data. Search and segment out small business applicants that you had to turn away in the past, but that now—with automated rules and processes in place—would meet your loan criteria and be credit-worthy. Identify trends, like industries, cash flow, risk profiles, and more, and tailor campaigns, promotions, and messaging to these targets using the contact information already contained in your database. And you can go even further by targeting other small businesses with similar profiles. Instead of being reactive to small business applicants, you can proactively encourage small businesses to apply online—generating more qualified, profitable applicants, and monetizing a whole new segment of your database.
Your database holds tremendous potential to expand your lending—and your reach. With an end-to-end digital solution, you can monetize your storehouse of data to profitably increase your small business lending. To learn more, contact LendingFront today.
