Our MSME Working Capital LOS For One Of The ‘Big-5 Banks’ Reduced TAT By 75% And Increased Workforce Productivity By 2 Times.
The Client’s Story
“It is no secret that MSME is a highly profitable segment if Loan Origination is executed well. It, additionally, brings high value cross-selling (viz. CA, FX, Loans) along with it. When Servosys undertook this project we had as low as 4% of the total market share. In order to achieve a double-digit market share in the MSME segment, we wanted a tech-driven transformation so that more effective data insights and rhythm could be imbibed into our way of processing the loans. Consequently, we were able to significantly reduce the Turnaround Time for processing MSME loans, by 75%, and also double the productivity of our workforce. Our other desires were to achieve a truly paperless mechanism and ensure standardization and interoperability between branch banking and different teams at different places and levels. We achieved all this. Now, happily, I can say our MSME loan decisions are data-driven, faster, convenient, and we will surely achieve our business objectives too.”
75% TAT Lowered for MSMEs Loans for One of the ‘Big-5’ Banks: MSMEs form roughly 29% of India’s GDP and it is expected to further increase as the government aims to increase the share of MSMEs up to 50% of the GDP. For lenders, MSMEs come with inherent profitability and subsequently, it becomes a very competitive segment for banks where only the best-in-class can survive.
Considering the vitality of the SME segment for clients, Servosys offered a state-of-the-art Business Process Management Suite with Customizable Credit Decisioning Engine to provide a truly end-to-end automation solution for the lending process.
Servosys undertook the challenge of minimizing
(1) The TAT in alignment with the Bank’s expectation
(2) A longer pre-screening process
(3) Simplifying the multiplicity of applications and data sources.
The end-to-end loan origination system offered by Servosys provided a unified touchpoint by integrating different portals and Web Services like Financials Analyzer, Banking Analyzer, Business Rules Engine, GST, etc. The Self-Service based platform further automated Digital Pre-Screening through multiple integrations, Account Opening, and RPA-enabled limits set-up to eliminate unnecessary loading of paper and 100s of hours of analysis. The system also alerts to RMs & Supervisors on Changing needs, Balances, Service Requests, Transactions, etc. automatically.
Similarly, other features such as Digital CAM with prefilled data, Auto-trigger of deviations, system-generated Sanction Letter, Auto-Calculated Limit Eligibility, Real-time Status check for borrowers, auto-generation of Document Checklist, etc. substantially reduced the effort, time, and cost of processing the loans.
Major Benefits
- Greater than 50% reduction in the length of Credit Appraisal Memo
- Greater than 60% reduction in processing documents
- Less than 2 hours for Financials, Banking Analyses & Ratings (earlier about 5 days)
- Zero effort finding deviations
- About 10 min for pre-screening (earlier 1 whole day)
- About 80% CAM fields pre-filled now
- Greater than 50% reduction in Title Search & other Legal aspects
- Greater than 85%+ cases delegated downstream
- Less than10 min for Due Diligence now
- Zero fields for required opening account
- About 30% New-to-Bank cases with remote Personal Discussion
- About 2 times improvement in productivity