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In the rapidly evolving financial landscape, banks are increasingly looking to technology to expand their commercial lending operations. With advancements in artificial intelligence (AI), machine learning (ML), automation, and cloud-based solutions, banks have powerful tools to streamline processes, reduce risks, and improve the customer experience. These innovations are not only enhancing efficiency but also enabling banks to scale their operations and reach untapped markets. In this blog, we’ll examine some ways that technology can help banks grow their commercial lending. Plus, we’ll explore some of the powerful AI and automation features in AXIS by AIO Logic that can help them do so.

1. Automating Loan Origination for Faster Turnaround

Loan origination is often a complex and time-consuming process involving multiple steps, including application intake, credit assessment, and document verification. Technology is transforming this process by automating key steps, significantly reducing the time it takes to evaluate and approve loans. For example, tools like optical character recognition (OCR) and robotic process automation (RPA) not only speed up loan approvals but also minimize errors and enhance compliance. By automating the origination process, banks can process more applications in less time, enabling them to scale their operations without compromising accuracy.

As a truly end-to-end platform, AXIS by AIO Logic automates tasks at every stage of the loan lifecycle, including loan origination. Unlike traditional OCR technology, our Document AI reads entire documents (e.g., financial statements, AR Agings, etc.) and translates the information into structured fields. This not only allows for more accurate data extraction, but also reduces manual entry requirements. Additionally, AXIS’s AI can automate the initial screening and validation of loan applications, reducing time and effort required for manual processing.

2. Enhancing Risk Assessment with Data Analytics

Effective risk assessment is crucial for expanding commercial lending. Traditionally, risk evaluation has relied on historical financial statements and subjective judgment. However, modern technology allows banks to use big data and advanced analytics to assess creditworthiness more accurately. AI models can analyze diverse data sources, including financial statements, transaction histories, and market trends, enabling banks to make informed lending decisions. Additionally, real-time analytics can help banks monitor the health of their loan portfolio and identify early warning signs of default, allowing for proactive risk management.

Thanks to our powerful AI functionality, AXIS can rigorously analyze vast amounts of data quickly and accurately to automate real-time underwriting, borrower financial health monitoring, collateral analysis, and portfolio risk. Specifically, AXIS can analyze data such as financial statements, transaction history, and market data to assess the creditworthiness of borrowers, providing more accurate and dynamic underwriting. Additionally, AXIS analyzes loan portfolios to identify trends, assess risk exposure, and optimize portfolio performance.

3. Streamlining Loan Servicing and Management

Once a loan is disbursed, efficient servicing and management are critical to maintaining a healthy portfolio. Technology can automate many aspects of loan servicing, from payment processing to account updates and reporting. Cloud-based loan management platforms provide banks with a centralized system for tracking loan performance, generating reports, and managing customer interactions. Additionally, advanced analytics and automation can also optimize the loan collection process. For instance, predictive analytics can identify borrowers at risk of delinquency, enabling targeted interventions to prevent defaults.

As mentioned earlier, AXIS by AIO Logic is an end-to-end platform that includes powerful functionality in the area of loan servicing and management. Payment management is one area of loan servicing that can often be quite time-consuming if performed manually. For that reason, we have automated payment management through features such as automated loan balance management, automated payment tracking, automated fee tracking, automated invoices and statements, automated reporting, and more. These are just a few of the many ways that AXIS can streamline loan servicing and management.

4. Improving Customer Experience

In an increasingly competitive market, customer experience is a key differentiator. Technology enables banks to offer personalized, seamless experiences that meet the expectations of modern borrowers. For instance, a bank could offer customized loan terms based on a business’s cash flow patterns or industry trends. Additionally, omnichannel communication platforms allow customers to interact with the bank through their preferred channels, whether it’s email, phone, or chat. By enhancing the borrower journey, banks can improve customer retention and attract new clients, further fueling the growth of their commercial lending operations.

AXIS by AIO Logic can help lenders improve their customer experience in several ways. Firstly, AXIS has native handling for every commercial loan structure including amortizing, revolving, ABL, delayed draw, interest only, factoring, and many more. This allows lenders to work with borrowers and offer a loan structure that suits their needs. AXIS also provides independent functionality for Current and PIK interest, as well as simple and compounding interest, allowing lenders to offer rate structures that are suitable for the borrower.

5. Reducing Operational Costs

Expanding commercial lending traditionally requires significant investments in staffing and infrastructure. However, technology can help banks achieve scalability without proportionate increases in costs. Automation reduces the need for manual intervention, while cloud-based solutions eliminate the need for costly on-premise systems. These cost savings can be passed on to borrowers in the form of competitive interest rates, making the bank more attractive in the marketplace.

While AXIS offers powerful functionality, our platform also provides significant cost savings to lenders. In fact, many users of AXIS save up to 50% at each loan stage compared to previous systems. These cost savings can be largely attributed to increases in efficiency that are realized through AXIS’s automation capabilities. AXIS’s automation can perform tasks, analyze data, and execute processes faster and more accurately than humans, leading to substantial efficiency gains, error reduction, and cost savings.

Conclusion: A Tech-Driven Future for Commercial Lending

Technology is reshaping the commercial lending landscape, enabling banks to scale their operations, manage risks, and improve the customer experience. By investing in automation, data analytics, and digital platforms, banks can position themselves for growth in an increasingly competitive environment. As technology continues to evolve, the opportunities for innovation in commercial lending are boundless. Banks that embrace these advancements will not only expand their reach but also build stronger, more sustainable relationships with their customers. If your bank is seeking to invest in technology to fuel its commercial lending growth, feel free to contact us today to schedule an intro call and learn more about all that AXIS has to offer!