The internet has really bolstered the lending industry. The technology behind the fast lending industry has really changed the way that we borrow as well. From faster mortgage approvals to the ability to compare loans online- it’s safe to say that things have changed so much, even from just a few short years ago.
Where it Began:
Online lenders really did fill a gap in the industry. There was a time when banks were not able to provide the money for people when they really needed it. Banks tightened up lending allowances and more and more people needed access to money, fast. For this reason, an alternative had to be found, and fast. This is where online lenders really rose to the challenge. The mere idea of having a remote option did make people feel better about themselves and it also meant that there was no lengthy financial application process required. Credit scores didn’t come into play in most cases but at the end of the day, accessible finance was soon available to the masses. Now you can get small business loans online with many loans being approved on the same day as application.
Innovation of Online Lending:
The innovation of online lending really was a natural progression from the archaic nature that came with traditional banking. Tech is now taking over our lives and the way we are able to work and handle our money online really was the next logical step. At the end of the day, consumers want to have a way to handle their money online and they also want instant gratification as well. Generation Z and Millennials are the biggest adopters when it comes to big tech and this helped to spur the lending industry even more.
The way that banks and even financial institutions manage, gain and store data really are huge concerns for customers. Banks have been able to access financial history for years now but when you look at data management, you will soon see that lending is becoming a much more consumer-controlled process. After all, you can now check your online credit score and you can find out what is bringing you down. When you have done this, you can then find out what you need to do in order to make an improvement and this will work in your favour overall.
Banking was once a very brick and mortar task and any time a consumer wanted to withdraw any money, they would need to take a trip to their local branch and they would also need to work hard to organise their finances too.
AI and Machine Learning:
Banks, credit card companies and even lenders have all been using AI and machine learning to make sure that they are not funding any fraudulent activity. This is difficult to say the least, but AI learning has helped a lot over the years and it just goes to show how far things have come since online banking and loan providers started out.