Cryptocurrency is all the rage as finance and technology come together in today’s ever-changing global society. Despite all the hype and attention Bitcoin and other digital currency are getting, there’s a technological revolution happening in the loans industry that could provide excellent benefits for consumers.
These changes, discoveries, developments, and revolutions are already disrupting the loans industry — and much more change is expected in the coming years.
Entrepreneur Michael Eisenga explains three ways that new technology in the loans industry will benefit consumers.
#1. It’ll Be Easier to Get a Loan
Before the advent of Fintech, getting a loan of any type was quite the hassle.
Consumers would have to travel in person to a financial institution to learn what products they offered. Then, they’d have to start the manual, by-hand application process, which they’d eventually have to supplement with printed-out qualification documents.
After the financial institution processed the paperwork — which typically took weeks — the consumer would get the final decision. If they were denied a loan, they’d have to search around elsewhere and start the process all over again.
Today, with the use of tech tools and artificial intelligence, lenders can set parameters for who gets approved for loans and who doesn’t — and what terms for which they qualify.
Consumers simply have to enter basic information into a secure web form, and they can get a response back within the hour. When they’re approved for a loan, they can even get the proceeds electronically deposited into their account within days.
#2. Consumers Will Have More Choices
Technology has already simplified the loan application, distribution, and management process for both consumers and financial institutions. This fact also allows consumers to have more choice, not only on the lenders they choose but also on the loan and repayment terms.
Financial institutions are already providing consumers with a variety of options for repayment terms to engender them to their products. Consumers can choose shorter or longer repayment terms, and accept different interest rates based on what they choose.
This type of flexibility simply wasn’t offered before the advent of Fintech.
#3. Consumers Can Even Get Perks
Fintech companies are taking a completely different approach to lending than traditional financial institutions have in the past. Instead of the typical creditor-borrower relationship, they are acting more as a true partner or even as an e-commerce business.
In this way, Fintech lenders are offering consumers various perks, benefits, and savings for borrowing from them. Michael Eisenga says this is a huge benefit to consumers, who can earn rewards, lower interest rates, and educational tools through Fintech lenders.
The lower overhead costs allow these lenders to offer lower interest rates, allowing them to separate themselves from other lenders in this ultra-competitive market. In the end, the ones who benefit the most from this are the consumers.
About Michael Eisenga
Mike Eisenga is a successful commercial real estate investor with a banking and finance background and is the former mayor of the City of Columbus. As a President of both American Lending Solutions, a mortgage lending company (he founded and operated from 2000 to 2018), and First American Properties, he has a track record of creating and operating successful businesses. Mr. Eisenga is also devoted to property development and construction, primarily serving smaller local communities. Especially in the senior housing sector.