Lending is a meticulous business demanding unwavering attention. The success of your lending enterprise hinges on diligent oversight of operational metrics. Regular, preferably daily, review of performance indicators is crucial to steering your business on the right course.
The digital age has amplified the pace of lending activity. With increased accessibility, your loan portfolio can expand rapidly. This growth underscores the imperative for robust monitoring systems like Tendar.
This article will explain five (5) activities to monitor daily as a lending business.
- Loan Application Volume and Approval Rates
The number of loan applications a lender receives and the approval rate are critical indicators of business health. High application volume suggests strong market demand, while a low volume might signal issues.
The approval rate reflects the lender’s underwriting standards and risk appetite. A high approval rate could mean a less stringent process, while a low rate might indicate a conservative approach. Doing daily checks on this is essential for sustainable growth and risk management.
- Loan Performance Tracking
Loan performance tracking involves monitoring how loans are performing throughout their lifecycle. It includes assessing repayment behaviour, identifying potential risks, measuring the overall health of the loan portfolio, managing potential risk effectively, and optimizing collection efforts.
- Disbursement and repayment activity
This cyclical process allows lenders to provide funds to a borrower (disbursement) and subsequently collect those funds back (repayment). It’s a core function of lending that impacts cash flow, risk management, and overall operational efficiency. Accurate and timely tracking of these activities ensures smooth operations, financial stability, and risk mitigation.
- Credit risk assessment updates
Credit risk assessment updates are one of the cornerstones of lending that must be tracked daily in lending institutions. It involves continuously monitoring and reassessing the creditworthiness of borrowers. This process entails tracking changes in borrower information such as credit scores, income levels, employment status, and overall financial health.
- Customer Behaviour Analysis
This activity gives insight into how customers interact with your products and services as a lender. It includes analyzing loan usage patterns, repayment behavior, customer engagement levels, and other relevant data to make an informed business decision.
Neglecting these critical activities can have severe consequences. Without proper monitoring, operational inefficiencies, financial risks, and customer dissatisfaction can erode your lending business’s foundation.
Tendar’s all-in-one lending platform allows lending businesses to track the activities of their lending business daily. Everything necessary for a smooth operational activity in your lending business is available on Tendar.
Need to start lending smartly using Tendar? Send an email to hello@tendar.co or talk to sales via tel:+2349039181976.
