We applied for a business loan through an alternative lender: here’s what happened

Cheryl Kardos

October 30, 2018

bad customer experience

Here at Numerated we're focused on building the best digital business lending software for banks, which includes delivering an exceptional customer experience for borrowers.

So it may come as no surprise that, as a financially sound business ourselves, we applied for a business loan with two super-regional banks offering digital lending. Both banks’ customer experiences are outsourced, co-branded applications with an alternative lender.

Below summarizes our (painful) customer experience.

When digital does not deliver convenience

Most would agree that directing a business owner away from a bank to a third-party is not a confidence evoking way to begin a financial relationship. But that’s exactly how these customer experiences begin. Upon clicking “apply now” we were presented with a warning that we’d be redirected to an “unaffiliated” website where the “privacy and security policies” were different. When we consulted the disclosures as the warning suggested, we learned the alternative lender reserves the right to sell personal information to third party marketing companies as part of a user’s consent. Concerning.

Once we moved forward to the application, we were taken aback by the amount of information the borrower was required to provide. More than a dozen application screens and more than 75 fields of information to recall and enter. There were several duplicative questions around use of proceeds and industry; elaborate amounts of financial information such as annual sales, annual profit before tax, outstanding debt, office space, customers, employees; personal information including credit, home ownership, value of retirement and brokerage, annual household income. Little of this we could recall from memory, so we had to dig through file cabinets and log into other accounts in order to obtain the information. Frustrating.

This customer experience would have been even more tragic had we been a current customer of the bank. The application also asked for a long laundry-list of basic personal and business information that the bank already knows about its customers, yet only asked if we were a customer when we were something like six pages into the application. In other words: the bank’s customers are treated like complete strangers.

We were well over 30 minutes into the customer experience at this point, and needed to abandon the application to move on to other priorities. In the coming days we received an email asking if we needed help completing the application. We expected this to come from the bank, as surely the bank was interested in developing the banking relationship. But it did not; it came from the alternative lender.

Furthering the tragedy: when we walked into one of the bank’s branches for assistance with the application, the banker had no record of our submitting a digital application, no tools to find the application, and ultimately no way to help us out. I’m not sure who was more astonished by this: us or the branch employee.

Do these banks offer a digital lending experience? Yes. Is it convenient? When compared to the traditional manual process, perhaps. But candidly, had we called our banker or begun at a branch at least the bank would have known who we were and helped populate this information into the application for us.

When digital delivers Net Promoter Scores of 100

Now imagine a digital lending experience that does the work for the borrower.

This is a customer experience where the underwriting is done before the borrower even applies. An application that is pre-populated with the borrower’s information. An application that doesn’t require digging through file cabinets or remembering and connecting bank account numbers and passwords. An experience that presents the borrower with a handful of questions, and offers both decisioning and funding in minutes. An experience that is consistent and integrated across bank channels. An experience that recognizes customers as customers, and treats them as such.

This digital lending experience exists. Banks using our real-time lending platform offer businesses a personalized, pre-populated, 5-question application. The harnessing of additional application data and underwriting is done in advance of the borrower applying. The business never has to go to the file cabinet. The entire process⏤from filling out the application to account funding⏤takes less than 5 minutes of a business owner’s day.

This is convenience. This is the type of digital customer experience that is so remarkably convenient that borrowers are compelled to rave about it to their fellow business owners. It is a digital customer experience that generates Net Promoter Scores of 100 for many banks. And we couldn’t be more proud to empower banks with a platform that delivers this level of customer delight.

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