We’ve said it before, and we’ll say it again: If the COVID-19 crisis has been a catalyst for anything, it’s digitization. Across industries and around the globe, an accelerated race to digital adoption has divided the survivors from the stragglers—and landed innovators securely in the lead.
The past year has proven that change happens fast. But even if your bank wasn’t at the forefront of digitization in 2020, it’s not too late to set a new pace for 2021. Competitors may have been quicker to the punch, but that doesn’t mean they selected the most efficient digital solutions—so there’s still an opportunity to get ahead.
Putting the recovery landscape in perspective
In the words of McKinsey, the recovery will be digital. And recovery is a long-term game. According to the 2020 Global Banking Annual Review, banks will continue facing operational challenges through at least 2024. Anywhere from $1.5 trillion to $4.7 trillion in cumulative revenue could be lost between 2020 and 2024, and in a base-case scenario, $3.7 trillion of revenue will be forgone over the next five years—the equivalent of more than six months of whole-industry revenues.
With a daunting five-year stretch of uncertainty ahead, your competitors’ paths to continued sustainability, scalability, and small business lending success comes down to the digital solutions they landed on back in 2020. By optimizing your own tech decisions today, you can leapfrog over the competition tomorrow—pulling ahead of the curve despite initially lagging behind.
But time is of the essence. Even before the crisis, leading banks in developed markets had achieved 25% less branch use per customer than competitors by transitioning payments, transfers, and cash transactions to self-service and digital channels. Beyond the pre-existing segment of digital-only customers, it’s estimated that another 10 to 15% of customers will be unlikely to use a branch after the crisis, strengthening the case for immediate action.
Though you may be hesitant to invest in new technology amid such turbulent times, there really isn’t a choice. If you want to stick around, you have to get ahead: it’s as simple as that.
Today, small business lending technology is no longer limited to solutions that take years to implement, learn, and generate ROI. Modern options offer in-year ROI—and in 2021, you may need that more than ever.
These options come in the form of end-to-end, automation-based digital solutions—and they look nothing like your prior tech projects. The right end-to-end digital small business lending solution:
- Is a significantly smaller investment. Fully integrated, end-to-end technology cuts out the costs of disconnected point solutions and time-consuming manual processes. By adopting an all-in-one digitization platform, you make a relatively small investment for an outsized return.
- Deploys faster than other solutions. With the right solution, your bank will be back on its feet within just a few months. End-to-end, automation-based solutions are backed by sophisticated technology and a slew of integration capabilities—but a fully centralized platform and built-in, automated controls make them lighter to deploy and leaner to implement.
- Is flexible to meet your needs. The most robust small business lending technologies can work as either stand-alone solutions or fully integrated ones. Depending on your bank’s unique needs, the right product can operate as your one-stop-shop, or connect seamlessly to the other solutions in your tech stack.
- Offers built-in integration services. While market solutions require you to hire implementation staff, allocate internal resources, or turn to a third-party integration system, the best digital solutions will handle the entire integration process for you—allocating their own teams or augmenting staff to fill in gaps and get you up to speed in record time.
- Generates ROI within weeks—let alone within the year. The quicker you deploy, the quicker you generate returns. The strongest small business lending solutions deploy quickly and easily, are intuitive to learn, and automate your existing manual operations to lower the cost of lending—generating ROI across the entire lending continuum (from origination, to underwriting, to funding, and even to repaying) within weeks.