A dealer portal combining non document verification and document verification in a waterfall with digital collection tools and dealer rewards provides several benefits that contribute to improved JD Power and CSAT (Customer Satisfaction) scores and enhanced capture rates.
Documentary and non-documentary validation are two different approaches to applicant validation that are beneficial for auto dealers in the loan onboarding process. The choice between approaches depends on various factors, including your level of risk tolerance, regulatory requirements, target customer base, and available resources. So, many financial institutions use a combination of documentary and non-documentary validation methods to balance accuracy, efficiency, and risk management.
Here’s how to reap the benefits of a Digital Dealer Portal:
1. Streamlined User Interface:
– Design the dealer portal with an intuitive user interface making it easy for dealers to navigate and access the functionalities.
2. Non-Documentary Validation Integration:
– Incorporate non-documentary validation tools in the portal. Note that, this may include AI-powered algorithms to assess applicant data and creditworthiness without relying solely on documents.
Non-Documentary Validation Benefits:
- Efficiency: Non-documentary validation methods, such as automated credit checks or data analysis streamline the verification process, reducing the need for manual document handling.
- Speed: Non-documentary methods are faster, enabling dealers to make quicker loan decisions.
- Data Accuracy: Automated validation methods reduce the risk of human error in data entry and analysis.
3. Document Collection Module:
When it is necessary to provide documents, include a document collection module so dealers can securely upload and verify required documents, including identification, income proof, and vehicle details.
Documentary Validation Benefits:
- Enhanced Verification: Documentary validation involves verifying loan applicants’ documents, such as pay stubs, bank statements, and identification. This provides a higher level of confidence in the applicant’s financial situation and expands market opportunities.
- Reduced Fraud: Documentary evidence helps reduce the risk of fraudulent applications, as it’s more difficult for applicants to pass off fake or inaccurate documentation.
- Compliance: Documentary validation aligns with regulatory requirements and compliance standards, reducing dealers’ legal risks.
4. Real-Time Analytics and Reporting:
Include real-time analytics and dealer reporting tools in the portal. This allows dealers to monitor their performance, track capture rates, and identify areas for improvement.
5. Automated Notifications:
Implement automated notifications and alerts to keep dealers informed about upcoming collection tasks, document requirements, and their progress towards earning rewards.
6. Training and Support Resources:
Offer training materials and resources in the portal to help dealers improve their skills in customer engagement, document collection, and non-documentary validation techniques.
7. Feedback Mechanism:
Include a feedback mechanism allowing dealers to provide input and suggestions for system improvements. This helps refine the portal and addressing any pain points.
8. Compliance Checks:
Integrate compliance checks into the portal to ensure that all documentation and processes adhere to regulatory requirements. This helps mitigate risks associated with non-compliance.
9. Customer Engagement Tools:
Provide tools that assist dealers with effectively engaging with customers. This includes automated messaging or chatbots to answer customer inquiries and guide them through the application process.
10. Scalability and Flexibility:
Finally, ensure that the portal is scalable to accommodate future growth and adaptable to changing regulatory requirements and market conditions.
In conclusion, by combining these elements in an online dealer portal, lenders create a comprehensive platform empowering dealers to capture more customers and optimize performance. Combining non-documentary validation, document collection, dealer scoring, and rewards not only improves capture rates it also enhances dealer engagement, compliance, and overall efficiency in the lending process.
An earlier version of this article appeared on Auto Finance News.
With more than 15 years’ experience in the financial services industry, including tenures at Santander Consumer USA and Visa, Jessica Gonzalez is now the Director of Lending Strategies at Informed.IQ.