SME Lending

Meet Katharine, a CIO at a regional bank. See how she uses IBM Cloud® Paks to capture new business, as well as save time and money for the bank and her customers.

1. Capture new business

Katharine needs to scale her business, reduce costs, and deliver technology that can speed up the Small and Medium Enterprise (SME) lending process to stay competitive. The current SME loan origination process is both costly and time consuming, preventing the bank from capturing a highly lucrative market and growing revenue.

Using the IBM SME lending solution, Katharine leverages IBM Cloud Pak® for Data, IBM Cloud Pak® for Business Automation and IBM Cloud Pak® for Integration to better capture data, automate processes and integrate with other tools to dramatically cut costs and time. This expands her team’s capacity to focus on seizing new business opportunities to grow revenue.

Watch the video to uncover how modernizing applications is good business strategy for any organization, and learn about Nedbank's success using IBM Cloud Paks.

2. Reduce costs and save time

Working with sales and marketing, Katharine is aware of the large market of SME revenue and understands that her team needs to reduce loan origination cost and the time required to process the loan in order to capture market share. In order to do that, she needs to modernize applications and processes.

IBM Cloud® Paks harness the power of AI to identify the most relevant data needed to process the loan and leverages automation technologies to cut manual processes that drive labor costs.

Learn how TD Ameritrade improved processing time with IBM Cloud Pak® for Business Automation.

Meet Michael, the IT architect assigned to support an ambitious new SME lending journey that provides unparalleled user experience in the industry.

1. Modernize applications

Michael is responsible for deploying a technical environment that can support an intelligent and insight-driven process. He needs to leverage the full spectrum of automation to drive and speed up the loan approval process. With current business capabilities scattered across different channel-specific or backend systems, Michael decides to modernize the company's applications and build a solution architecture on an open and cloud-native foundation.

To get started, Michael uses IBM Financial Services Workbench, a solution development and composition suite, which lets the team compose business solutions rather than code them. The freedom to compose solutions protects past investments and existing business capabilities. It also enables best-of-breed solutions and allows phased modernization of existing applications. The collaborative design and development tools with low- and pro-code stacks enable developers of varying skill levels to design, build and run the required services based on modern microservices architecture principles.

Additionally, the cloud-native foundation makes way for composable solutions. It enables Michael to cherry-pick business capabilities built internally or sourced externally to meet customer expectations.

Watch this demo to see IBM Cloud® Paks at work:

2. Support disparate technologies

Teams are feeling significant pressure to constantly adopt new technologies to improve business outcomes. Maintenance of existing applications must progressively converge with new application components, including a substantial period of co-existence. Michael wants to establish consistency and standardization from the beginning to support the growth ambitions of the team.

Michael creates a new application composition of reusable business capabilities, and leverages IBM Cloud Pak® for Business Automation to seamlessly integrate these capabilities into day-to-day business operations. App Connect, as part of IBM Cloud Pak® for Integration, securely connects the existing environment and various cloud systems without his team having to write a single line of code.

The result: Business users love the integrated experience that allows them to easily interact with the worklist, and the composed experience enables them to see all relevant information in one consolidated view.

Enterprise agility is essential for modern, digital companies. It may seem like you have to start over to achieve it, but in reality, agility is about improving what you already have.

1. Improve data consumption

Mina uses customer data from the enterprise data warehouse. This data needs to be kept secure, so it cannot leave the enterprise’s secure IT zone. Also, there needs to be an audit trail of data access and its use.

IBM Cloud Pak® for Data is an ecosystem for everyone — from data scientists to business users — to work together on data projects.

Learn how advertising giant, Wunderman Thompson, and its clients used machine learning for better discovery and hypothesis creation and spent less time in mundane tasks. They did so using a combination of Watson Studio capabilities in IBM Cloud Pak for Data and open source tools.

2. Build predictive models

For many financial institutions, loan recommendation algorithms are based on rules-based systems, which can be limiting. Mina has to develop and train a predictive machine learning model for recommending whether a loan should be approved or declined.

Mina also needs to deploy the predictive model so that it can provide the recommendation alongside the rules-based score. That way, the two scores can be factored together for a composite score.

Combining the data, AI and integration capabilities of different IBM Cloud® Paks allows Mina to develop highly effective machine learning models. The resulting output from the machine learning models adds to the knowledge catalog as governed data assets. It provides a lineage of activities around the use of the models, the supporting data sets, and connections to business glossary terms. This capability ultimately improves the decision-making process for loan officers.

Listen to the experience of H&R Block, and how it leveraged IBM Cloud® Paks to implement AI in its processes to achieve better results.

Meet Jacques, a loan underwriter who evaluates applications from small and medium enterprises. Discover how IBM Cloud® Paks help him reinvent his loan approval process.

1. Improve data-driven decisioning

Jacques relies on a rules-based model for approval recommendations, and while it is effective for specific situations where the rules offer clear guidance (for example, where a credit score is below a certain threshold), it is not effective for more nuanced situations.

Using Operational Decision Manager (ODM) capabilities in IBM Cloud Pak for Business Automation, Jacques can evaluate the customer’s contextual information against configurable business thresholds. And, IBM Cloud Pak® for Data allows Jacques to perform more sophisticated interrogations of the data.

With more actionable information available in a loan approval dashboard, Jacques can more efficiently analyze each loan request case, resulting in faster loan risk assessments, from 45 minutes down to zero.

2. Speed approval processes

Once a loan application is submitted, Jacques awaits the arrival of information that will help him in his decisioning process. This normally takes days as it involves a significant number of manual operations performed by people in an overworked loan processing department. Manually transposing loan applicant information into the bank’s systems is also time consuming and error prone.

IBM Cloud® Pak for Business Automation connects tasks between people and departments, as the business automation workflow drives the loan approval process. Some of the more time-consuming tasks, such as credit score application and recovery process, are assigned to digital workers. This is configured through Robotic Process Automation (RPA), to accelerate approval time.