Digital Mortgage

Transforming digital mortgage: AI's impact on digital lending

There is no doubt that digital technology has revolutionised the traditional lending process. What was once a tedious, time-consuming process that involved endless forms followed by protracted approval and disbursement times has transformed into a paperless transaction, which can now be closed in a matter of hours. In addition, industry leaders are incorporating artificial intelligence (AI) and machine learning (ML) into the mortgage industry to further streamline operations, reduce costs, and stay competitive. A few of the most common functions of AI in the loan application process include:

  • Gathering and pre-filling customer application data
  • Evaluating creditworthiness
  • Monitoring market fluctuations in real time to provide strategic insights
  • Predicting customer readiness for a purchase
  • Authenticating data by scrutinising various external databases
  • Sending timely alerts to customers and team members to keep them apprised at various stages of the mortgage cycle

As technology evolves, we are now at a point where the scope for implementation of AI in the lending industry far exceeds these task-focused functions and has the potential to revolutionise the digital mortgage industry. According to a recent study, a majority of top industry executives believe that lending organisations that are in the process of incorporating advanced AI and ML technologies into their business processes project the most promising growth, especially in the post-pandemic landscape.  

Improved customer experience, reduced loan cycle times, informed decision-making, and effective marketing are just a few ways in which the timely integration of AI-infused business practices can help industry leaders level up. You may employ AI lending methods such as chatbots or virtual assistants to personalise the loan application process and accelerate proceedings; however, leveraging AI to speed up back-end operations is where lenders can expect game-changing savings in terms of costs, time, and labour. Here are a few examples of AI-based systems that can revolutionise how lending institutions conduct business.

  • Modern optical character recognition (OCR) software can ensure error-free data extraction from documents in a fraction of the time it takes for an individual to manually sort through pages of paperwork. Reviewing, indexing, and filing can be automated, which speeds up processing time and allows employees to focus on more complex tasks and engage in higher-value business activities. Replacing such labour- and time-intensive manual processes with an automated, AI-driven approach can immediately translate to considerable cost savings and elimination of human error.
  • Robotic process automation (RPA) can take over repetitive, mundane tasks and execute them with greater consistency and accuracy, thus ensuring quick, error-free results. RPA solutions can process customers’ information, automate the underwriting process, and take logical decisions on a case-by-case basis with minimum human supervision and intervention.
  • AI-based ML models can routinely track the progress of loan applications, valuate assets, verify compliance, make credit checks, and more to help speed up processes while automatically keeping customers appraised of their application status.
  • Blockchain platforms can create self-executing smart contracts that use high levels of data encryption and circumvent the need for a third party to verify their authenticity. This eliminates intermediaries such as witnesses, lawyers, courts, associated fees and charges, and time. Not only do smart contracts ensure transparency, security, and speed, but being paper-free, they also contribute to reducing an organisation’s environmental impact.

In this age of technological advancement, it seems natural for organisations to leverage cutting-edge technologies to build business value, witness sustained growth, and increase profits. However, businesses that shift from established processes and adopt new methodologies might feel overwhelmed if they lack a clear transformation strategy in place. You can choose to outsource key processes that can benefit from AI integration or acquire the technology from external providers.

For organisations on the digital transformation journey, agility is key in responding to a rapidly changing technology and business landscape. Now more than ever, it is crucial to deliver and exceed on organisational expectations with a robust digital mindset backed by innovation. Enabling businesses to sense, learn, respond, and evolve like a living organism, will be imperative for business excellence going forward. A comprehensive, yet modular suite of services is doing exactly that. Equipping organisations with intuitive decision-making automatically at scale, actionable insights based on real-time solutions, anytime/anywhere experience, and in-depth data visibility across functions leading to hyper-productivity, Live Enterprise is building connected organisations that are innovating collaboratively for the future.

How can Infosys BPM help?

Infosys BPM helps create a roadmap to guide your organisation’s digital journey. We offer strategic methods to incorporate AI into crucial business processes with a slew of services built around digital mortgage operations, including document classification and extraction, AI/ML conditioning solutions, RPA, advanced analytics, master data management, knowledge management, and intelligent task management. Discover how Infosys BPM can transform the way you do business.

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