How Home Credit Automates Its Loan Disbursement Process, IT News, ET CIO

From self-driving cars to robots that pick and pack in retail warehouses to virtual assistants like Alexa and Siri, automation is everywhere. The auto loan industry is no different. Automation also has a positive impact for lenders and borrowers.

Home Credit, a local branch of the international consumer credit provider, uses a mix of lending technologies to automate and make the lending process smart. In a conversation with ETCIO, Ladislav Simicek, CIO, Home Credit India highlights these technologies.

“It is vital for an organization to make customer orientation its core value. Although digitalization has grown, Covid has given it a boost and picked up the pace. For us at Home Credit, it has become even more imperative to offer a fast and simple digital journey, not only to ensure that the customer does not have to leave their home or workplace, but also to make their significant, widespread and practical experience, ”said Simicek.

The process from the integration of a client to the disbursement of the loan is heavy in operations due to several interventions. Home Credit’s digital analytics tool helps better understand customer segments and empower the business to create and deliver products better suited to the business’s TG needs.

Home Credit’s digital analytics tool uses a combination of demographic, psychographic and behavioral information to better understand customer behaviors, which helps deliver the right products to the customer throughout the lifecycle through desired channels. . The tool generates an understanding of customer choices and helps tailor product offerings best suited to individual customers, thereby improving operational efficiency and also optimizing customer turnaround time.

“From loan application to loan approval, we provide a complete digital solution for clients to obtain loans through various platforms. We structured the process and optimized it with technologies like OCR (Optical Character Reader), employing loan approval with just a few clicks. Our fast, digitized process allows our customers to have a seamless experience. Automating the process has allowed clients to obtain loans from the comfort of their own homes, ”added Simicek.

To assess the customer for a loan and predict his capacity for the EMI amount, Home Credit uses ML algorithms. This is to ensure that the customer is not overloaded or in default. ML algorithms also calculate actual risk data and financial or behavioral data from legitimate data sources available to the business in real time during the application process.

Models are tested for accuracy and performance before they are used in production, making the entire process data driven. As ML models continue to learn, the ability to assess and predict default rates and a customer’s EMI capability keeps improving, reducing risk and driving better value.

“Responsible lending being the cornerstone of its business, the company emphasizes freedom from bias, which is why continuous controls and improvements are systematically put in place,” he said.

To keep pace with the highly competitive industry, the company is improving the skills of its employees through a digital platform called Stratbean, a provider of artificial intelligence-based e-learning solutions for online learning. line and employee development.

“Digital innovation has allowed us to serve our customers faster with a unique experience. In this time of pandemic, our digital platforms have been used to help customers meet their needs / aspirations without compromising their security. Our customers get the solution with smooth and fast journeys and a user-friendly interface. Overall, as a company, we build a relationship of trust with our customers by providing them with practical solutions and maximizing resources through the automation of journeys through the integration of advanced technologies. In short, algorithms have made us wiser and more competitive, ”he concluded.