MonJa: A Buying Guide to Small Business Lending Software

A Buying Guide to Small Business Lending Software

In Featured, Small Business Loan Underwriting by Yulia GnatyukLeave a Comment

8 Minutes Read.


Lending software offers many benefits for financial institutions of all kinds. For small business lenders and institutions wishing to expand their markets, a lending software solution is virtually a must-have tool.

There are many top-notch lending software solutions now available, but how do you pick the right one? This handy guide provides some key things to look for in both a lending software package and a reliable provider.

Features of an Ideal Lending Software Solution

MonJa: A Buying Guide to Small Business Lending Software

Ease of implementation. A lending software solution can revolutionize your business, but it need not be disruptive. A good package will integrate easily with your existing business systems and not require costly hardware upgrades. Business downtime when migrating to the new software system should also be minimized.

Take advantage of the opportunity to “try it before you buy it”. Reputable vendors offer a free demo or a trial version. Try out the software with your credit team who would be using it to see if it meets your needs and can be easily deployed in your business.

Ease of use. One of the big advantages of lending software is that it makes the loan processing workflow much faster. This advantage can be lost, however, if the software package requires extensive training time. Look for a solution that offers an intuitive workflow: Your team should be able to “learn as they use,” without having to spend much time consulting training manuals or programs.

User-friendly interface. The ultimate goal of digital lending is to grow your business through improved customer experience. A good small business lending software solution offers a simplified user interface for both your people and your clients. Compatibility with smartphones and other mobile devices has quickly become a standard for financial services of all kinds, and lending programs are no exception.

A good interface with mobile capabilities allows customers to make loan applications online at their convenience. This automatically extends your market reach, as customers no longer need to visit your office or branch in person. It also allows customers to monitor the progress of their applications. The same features also make it easy for you to monitor your business from anywhere.

Actionable analytics. Because of its data management capabilities, a good lending software solution should enhance your analytics. In manual loan processes, many useful analytics are difficult to track. Lending software that truly improves your business should give you easy access to process management, customer feedback and tracking exceptions.

The benefits of good analytics are enterprise-wide. Better monitoring and management keep loan processing flowing smoothly even with high volumes of applications. Access to broader customer feedback allows you to provide a more customized, responsive experience for your clients. And of course, a better client experience directly translates to more business.

Accurate credit scoring. Lending software should provide a credit scoring framework that allows you to improve your risk management for both existing and new accounts. An included credit policy model that is aligned with industry best practices is fine, but it should allow customization to reflect your institution’s own risk and value criteria.

An ideal lending software solution should provide three things. First, it should offer automated integration with established credit reporting agencies and other common sources of credit information. Second, it should provide flexibility to enhance traditional credit bureau data with customized scorecards. This includes options for using nontraditional scoring criteria for small business borrowers or others who don’t fit conventional credit profiles. Finally, the best programs utilize artificial intelligence (AI) to analyze and refine the credit scoring framework.

An accurate credit scoring capability allows the lending software to handle the flow of normal business, so that your people’s experience and judgment can be focused where it matters most.

Choosing the Right Provider

MonJa: A Buying Guide to Small Business Lending Software

Choosing the right provider can be as critical to the success of your business as using a capable, flexible lending software solution. Your business has its own unique requirements and objectives, so your software provider should offer a solution that supports them, rather than an “off-the-shelf” package.

Reliable customer support. There are two aspects to customer support that a solution provider must offer: technical competence as well as a good customer experience. Security and keeping systems up and running are critical for financial institutions. This is not simply a matter of good business practice for most financial institutions, but a compliance issue as well.

The right provider will offer 24/7 support for any technical issue that arises and have the capabilities and expertise to provide rapid solutions. Likewise, your experience as a customer directly affects how well the lending software solution can work for you. The right provider will offer ongoing training support and be responsive to your feedback about its product. Look for a provider that will be a true partner in your business rather than just another vendor.

MonJa: A Buying Guide to Small Business Lending Software

Cloud-based solutions. For many businesses, a cloud-based lending software solution is more than just an economical option. A cloud-based solution can be deployed faster at much lower cost, without the need for system upgrades. The managed software-as-a-solution (SaaS) eliminates the need to dedicate time and resources to IT management, and lets you focus on building value for your business.

The right provider will offer you a robust and reliable cloud-based solution. A good package must include high-level security as well as backup systems to prevent downtime. And of course, the cloud-based solution must be backed by dedicated, reliable customer support.

Affordability. Some lending software solutions offer more than what financial institutions need. You may, for instance, wish to introduce a new system gradually. Or the best available solution may include features you simply will never need.

The right provider will offer options such as modular packages or scalable solutions that grow as your lending business grows. Options such as these make the lending software solution not only affordable but appropriate for your needs. For example, here at MonJa, we offer a unique pay-as-you-go structure which allows financial institutions justify the partnership even at a fairly low origination volume. Cost flexibility helps our clients smoothly implement our lending platform for one loan type or branch and gradually expand over time, cost-effectively.

Proven track record.  It is one thing for a lending software provider to say it offers excellent customer support, robust cloud-based solutions and affordable options, but has it really done it? The right provider will have a proven track record of providing effective solutions to businesses like yours.

MonJa is one of the top providers of lending software solutions for all types of lenders, including banks, credit unions, online lenders even non-profit lenders.  To see what our lending software solutions can do for your business, request a free demo today.

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Our platform supports consumer term, C&I, CRE, auto and other small business loans.

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