Lending is the core business of most banks and NBFCs. Several documents are collected during the loan origination cycle. Among them, the bank statement is an important financial document. It helps assess a loan applicant’s creditworthiness, whether it is an individual or an enterprise.
But what is the most efficient and cost-effective way of analysing bank statements?
Bank Statement Analysis Software: Why Should You Have One?
Bank statements run onto several pages; it is a cumbersome task to collect them and analyse them, making the process prone to errors. NBFCs, banks, and other financial institutions face several other problems like the manual collection of bank statements, slower turnaround time, higher manual efforts, and lesser productivity. This leads to customer dissatisfaction. Using Bank Statement Analysis (BSA) software provides solutions from all these pain points in one go.
BSA software utilises powerful Artificial Intelligence (AI) to provide real-time analytics. BSA software brings automation into your hands, effectively eliminating any error arising due to human intervention. The automation reduces dependence on manual work, enabling freeing up human resources for undertaking core activities and enhancing overall productivity by focusing on business development.
Bank Statement Analysis Free Software: How to Pick The Right One
Good software gathers financial data through multiple sources and helps derive meaningful insights. With its data aggregation and data analytics, the Bank Statement Analysis software must empower financial institutions with powerful data solutions. When looking for good software, look for these features:
1. Loan Repayment Prediction Score
This score enables financial institutions to make fast credit decisions for new and recurrent borrowers by analysing data from numerous sources. The score helps to identify the stability of inflows and outflows as too many inconsistencies indicate fluctuations in the account, a possible red flag.
2. Enriched Report
The software presents a comprehensive report with key insights and trends observed in the applicant’s financials like spending pattern, income obligations, moratoriums, and others. The software provides a seamless experience by either fetching bank statements directly from the bank or by scanning e-statements in seconds.
3. Obligation Identification
The deep learning of the software analyses the spending patterns from the bank statements. The reports give a clear picture of loan obligations, OD analysis, cash flow gaps and any other potential triggers cheque or loan bounces. A safe and secure way to instantly verify accounts.
4. Account Aggregator Integration
The software has AI-driven patterns that recognise the complex transactions of financial data collected from different sources, including credit cards, loans, taxes, investment accounts and other financial data that you need. The Bank Statement Analysis software consolidates it into a single platform for an easily readable and viewable format to gain an individual or an SME financing perspective. The account aggregator integration powers an efficient, next-gen lending process.
5. Fraud Detection
The software helps in understanding the repayment history of the borrower. Any case of non-payment or loan default can be revealed through careful analysis. The software detects activities that are potential red flags and indicative of poor creditworthiness. Such as periods in which debit transactions match credit transactions or a mismatch between statement balance and computed balance. Thus, saving you time and resources.
6. Behavioural Impact
BSA software helps analyse the transactional impact on the applicant’s financials due to current economic conditions and COVID-19. The Bank Statement Analysis software analyses the bank statement and generates insightful reports that define the creditworthiness of the prospect.
7. Aggregation Across Multiple Bank Accounts
There are inherent challenges in deciphering the intricacies in the bank statements of an individual or an SME. Bank statements usually have different formats, narratives, and layouts that the software can assess. The software with ML algorithms does a deep analysis by categorising and analysing the bank statements across multiple bank accounts to present a complete picture of the applicant’s financial health.
8. Export Analysis To Easy Excel Sheets
A BSA software supports a wide range of financial statements across different formats. It can read data from statements of different entities across multiple segments such as small business, retail, individual, etc.
9. Spending Pattern Identification
The automated software helps analyse the spending patterns in the bank statement. The report gives insights into loan obligations, credit card payments, spending habits, and facts about digital spending. It helps to weed out circular transactions and other critical data.
How Is The Software Effective, And Why?
The software can be seamlessly integrated into your existing systems to complement the loan origination and assessment journey. The effectiveness lies in its ability to generate reports in both formats- human and machine. This makes it easier and faster to assess the applicants’ creditworthiness without or with human intervention.
The software performs an online assessment of several pages of bank statements, thus enabling faster decision making in lesser time and at a lower cost. The automated process reduces the time spent on processing the loan application, effectively benefitting both lenders and borrowers and increasing customer satisfaction. It helps in the assessment of borrower’s liabilities that may impact their capacity to repay the loan.
The software provides accurate financial reports concerning applicants such as individuals in rural areas and Micro, Small, and Medium Enterprises to Banks and other NBFCs. The MSMEs often lack collateral and are vulnerable to market ups and downs and several other temporary factors. The software allows robust and strong analysis of bank statements that can allow the assessment of rural credit.
Bank statement analysis is the simplest way to know about the payment history, transactional habits, etc.
Why Choose PRECISA?
Precisa’s BSA Analyser software enables a complete overhaul of your bank statement analysis process with its seamless integration into your existing lending management system.
It gives a comprehensive real-time view of the uploaded or fetched bank statements for a thorough assessment of the applicant’s financial analysis. This allows for a deep assessment of the applicant creditworthiness, faster turnaround time and quick decision making. Bank statement analysis software improves customer satisfaction resulting in great customer relations, bringing in more business and increasing customer retention.
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