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New International Research Shows Low Rates Of Digitization Within Receivables Finance

Wednesday, November 17, 2021
  • 80% of global receivables finance businesses are not benefitting from effective automation during the customer onboarding process
  • Trend points towards digitization as over 50% of respondents plan to digitize processes within the next 2 years
  • Technology can help lenders differentiate themselves in the market but only when correctly applied

EQ Riskfactor, a leading global provider of risk management software for the commercial finance market (part of Equiniti Group), today launches its new international report, Finding Your Competitive Edge With Technology.

The new report surveyed senior professionals from the receivables finance industry across the UK, US, Germany, France and the Netherlands. The report explores the lasting impact of Covid-19 on businesses during 2021, the repercussions of the withdrawal of government support, and how lenders can use technology and data to help them gain competitive advantage.

Many consumer financial service firms have already made the move online, but the research showed receivables finance lending is thought to be lagging behind. Global respondents reported that only 20% had onboarding processes that were mostly automated, whilst 80% of receivables finance lenders are not benefitting from automation.

Over 50% of those surveyed have plans to implement digitization over the next two years, however the data also showed that implementation doesn’t always go smoothly. The main obstacles preventing successful adoption were shown to be a lack of senior stakeholder engagement (18% of respondents) and challenges using legacy systems (20% of respondents).

As both individuals and organizations try to recover from the pandemic, it is critical that lenders understand each client’s performance and trends. Fast access to high quality data is key to successful onboarding. As government aid is withdrawn, using enhanced data throughout the customer life cycle also helps to protect the lender from fraud.

Technology, when correctly applied will not only enhance the customer experience, but it will also help lenders differentiate themselves in the market and gain competitive advantage. Automation and a comprehensive suite of data can help lenders onboard customers more quickly, support faster and more accurate lending decisions, and deliver a frictionless experience for the borrower.

The full report is available to read and download here.

Michael Ellis, Managing Director at EQ Riskfactor, commented:

“The receivables finance industry still has a long way to go in terms of adopting automation. In particular, during the onboarding process. There is desire within the industry to speed up digitization and automate more processes, but we believe more progress can be made. Customers are increasingly expecting immediate responses and frictionless access to cash across other products. It is now time to action this approach in receivables finance.”

“Whether it is an end-to-end transformation or a more focused adoption, the technology lenders embrace must provide value across their business. One of the easiest ways to ensure senior stakeholder buy in is to include them from the very outset. This not only makes them part of the decision-making process, it also makes it easier for them to see the long-term benefits. Wider adoption will then be much easier with them leading the charge.”

EQ Riskfactor’s established risk management technology uses automation to identify potential frauds using advanced analytics which highlight unusual activity, so that lenders can investigate and reduce risk.

ENDS

Read the full report

Notes to Editor:

About EQ (Equiniti)

EQ is an international technology-led services and payments specialist. With over 5,000 employees, it supports 36 million people in 120 countries. EQ’s purpose is to care for every customer and simplify every transaction, delivered with less of an impact on the environment.
Find out more https://equiniti.com/

EQ Riskfactor (part of Equiniti) is the leading provider of risk management and fraud analytics software and consulting for the global commercial finance market including factoring organisations, banks and alternative lenders. In the UK, over 90% of the receivables finance market use EQ Riskfactor’s products.