Did you know that consumer spending reached 12917.33 USD Billion in 2020? Despite difficult world conditions, consumers are still as active as ever and spending money.
How were consumers able to spend this large amount during a challenging economic year? The answer is consumer lending. People still as willing as ever to take on a loan to meet their financial needs.
If you are in the consumer finance sector, are you aware of the changes that are taking place right now? What do you need to know about consumer lending in 2020? Why not read on to find out.
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1. Efficiency Through Technology
In recent decades, financial institutions came under increased regulatory pressure from governments. This was in part due to financial crashes that affected entire economies. The result of this was that institutions increased their staffing level to meet the rising workload this created.
However, is there a danger that you are now overstaffed? You may be surprised to hear that software and technology solutions have increased and are now reducing the need for high levels of staff.
This is especially true in the mortgage and housing finance sector. Back-end technologies are reducing the manpower needed to support and assess loans. Companies such as Loanpal are thriving as providing finance for solar loans for example.
2. Evolving Expectations
As technologies improve across all sectors, consumers expect improvements in their experience. This is true with Netflix and this is also true when taking out a loan.
This is particularly desirable in the COVID-19 affected world of 2020 where consumers expect consistent service without the need for actual face-to-face contact.
When a consumer approaches an institution for a loan, they expect them to retain all information they provide. This reduces the chance of having to repeatedly give the same information.
These small technology-influenced changes make the difference between a happy customer and one that moves from provider to provider looking for a smoother experience.
3. Omni-Channel Capability
Omni-channel solutions provide a seamless experience that consumers are looking for. It basically means that a customer can access their information 24/7 and from the channel of their choosing. A transaction that was started in-branch can be continued via secure-webpage and so on.
Consumers of 2020 love the autonomy of being able to control their transactions. This means the same information should be made available via mobile app, web-page, in-store experience, and any other channel the financial institution chooses.
4. Natural Language Processing
When deployed in the right way, Natural language Processing (NLP) can save your business time and increase interaction with consumers.
One example of this is automated chat-bots. This technology has increased to the point where they are able to satisfactorily provide answers to basic questions as a human would. They can then provide guidance as to how to proceed to get answers to more complex questions.
All this data is then compiled and quantified. This is performed without any human assistance it can be rolled out with minimum staff increases.
Changes to Consumer Lending that Affect You
As the world and ıts economies continue to evolve in 2020, consumer lending is also changing. Progression in technology and consumer behavior has meant that experts are questioning the techniques of yesteryear and offering greater and more efficient financial solutions.
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