Insights Teslar - Flipbook - Page 2
AUTOMATING BUSINESS LENDING
INSIGHTS
K EY ME TR ICS
Can your bank’s customers apply
for loans digitally?
Source: Bank Director’s 2022
Technolog y Survey
Small business loans
14%
33%
Fully digital
51%
Partially digital
3%
No
N/A
Commercial loans
Automating the business lending process — for example, pulling together all the
forms needed to build a loan package — saves banks time and resources. Though
loan demand has weakened so far in 2023, this slow growth period could be an
ideal time to streamline lending processes.
9%
25%
Fully digital
66%
Partially digital
No
The spring of 2020 wasn’t the best time for a community bank like Bank
of Idaho to automate its small business lending process.
KEY TAKEAWAYS
The $1 billion bank, a subsidiary of Bank of Idaho Holding Co., had just made
it through the first deluge of Paycheck Protection Program loans. “We did ev-
• A period of slow loan growth could
present an opportunity for community
banks to automate the business lending
process.
• Commercial and industrial lending slipped
in the first half of 2023, with bankers
reporting weakened demand from firms of
all sizes.
• Automation frees up time and resources,
allowing bankers to focus on client
relationships.
• When upgrading lending processes, banks
should plan to run systems in tandem and
work out kinks in the new system.
• Banks can choose to automate all or some
of the lending process, based on their
unique needs.
erything manually, and it was terrible,” says Devan Wright, deputy chief credit
officer. He describes “12-hour days that felt like forever: waking up, approving
loans, going to bed, over and over again. We did thousands of loans.”
Executives quickly realized they needed to upgrade the bank’s underwriting
and loan processing systems to survive the second round of PPP, working with
Teslar Software to automate parts of Bank of Idaho’s loan underwriting and
documentation functions.
When the dust settled, Wright says, the Idaho Falls-based bank automated
the rest of the business lending process with Teslar. For example, it pulled into
one platform all of the 20 or so forms that could be needed if a loan required
a modification after it was booked, eliminating the need for a banker to go
hunting for the correct form.
With lending appetite down drastically today compared to the PPP period,
Bank of Idaho’s experience could make a compelling case for automating the
business lending process during the slow growth period many bankers find
themselves in now.
Lending Slowdown
Commercial and industrial lending slumped this year amid an uncertain
economic environment, characterized by rising interest rates, low unemployment and anxiety about a potential recession. As of June 1, the Federal Reserve
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