#HotChallenges for the lending market

Over 60 people followed the discussion between our experts: Ewa Wernerowicz (Vivus), Anna Kowalewska (Aventus Group), Agnieszka Lewińska-Olczak (Fingo Capital), Jarosław Ryba (PZIP), Łukasz Piechowiak (Fintek.pl), Łukasz Kawulok (VSoft), Jakub Rabong (VSoft) and Justyna Jastrząb (VSoft).    

During the first session , concerning the situation in the market, we asked the experts a few questions:

1. The situation in the market is arousing considerable excitement, what strategies have loan companies adopted for these strange times?     
2. Closing, waiting, or perhaps investing in development?
3. Has the pandemic given us anything positive?

The discussion was opened by Jarosław Ryba – President of the Polish Association of Loan Institutions and vice president of the European Fintech Forum. The statements focused on the current tough situation of lending companies in the market and was supported by analytics based on data from BIK and CRIF. After the presentation, our experts discussed the possible effects of the changes implemented by the regulator in Poland – such as a drastic reduction in interest rates and reduced limits on non-interest costs – in the market. We also reflected on who will survive in the market and whether online processes are a solution to the problems of the lending sector that will work during and after the pandemic. We noted that the changes which lending companies have made in adjusting their customer evaluation approach were aimed at preserving financial liquidity and maintaining a healthy and prospective customer portfolio.

Despite the difficult situation, the conclusions and glimpse into the future were not as pessimistic as one might expect. As Jaroslaw Ryba put it, the current crisis has dramatic effects, but it is also a strong stimulant for innovation, and the online channel can be a means of distribution in times of the pandemic by, among other things, reducing operating costs and making it easier to implement new products.

The second block of topics dealt with the ideal online process. We wondered what it should be like to deserve such a title. We were introduced to the topic by Jakub Rabong, Analyst at VSoft, who demonstrated what the process is, what it consists of, how thinking about processes has changed, and what innovations in the market are currently in demand and will effectively bring companies into the stream of innovation. Speed, a small amount of data completed by the customer in the forms, tailoring to the latest trends in graphic design and application ergonomics are key elements in the modern online process. Support for the assessment of the customer and the entire transaction no longer rests with employees, but with external databases, such as RDO, PESEL, BIK KI, CRIF, Kontomatik, CFD and BIK PAF, which are able to automatically and, most significantly, accurately and quickly assess the transaction. The process is not just granting loans, but also post-sales and operational processes within the company. This is where chatbots, rapid robotics and automation come in handy. Further discussion among the panellists and attendees in the chat room supported the validity of this vision and the direction the industry has taken.

The last session was perhaps the one most anticipated by the participants. Additional services, VAS – will they attract customers and generate additional profit, like hot dogs at a petrol station? Do customers really need a VAS?

We were introduced to the third part by Łukasz Piechowiak – editor-in-chief of Fintek.pl and director of the analysis department of the Polish Association of Loan Institutions. He presented VAS services as a new possibility of offering customers solutions that will be tailored to their needs (after a detailed analysis of the data and adjusting the solution to their preferences), and at the same time will provide added value to the organization. We talked about the necessary legal and compliance considerations and the organizational change that should be preceded by an analysis of behaviour and data. There were numerous questions and comments in this part of the discussion, and opinions were divided as to the validity of the implementations and their positive impact on the company’s performance. Some of the interlocutors also defined the service differently – some saw it as a VAS for the lending institution, others viewed the sheer possibility of borrowing as a VAS for that service. However, we all agreed that it is crucial to closely tailor additional services to the customer’s needs, as a broadly targeted, generic general offer will not bring the desired benefits.

In summary, we have completed an extremely interesting meeting, where we exchanged knowledge, experiences and plans for the future. Thank you for your active participation and we invite you to the next Financial Business Meeting events.