[Editor’s note: This is a guest post from Shaun O’Neill, President of Concord Servicing Corporation. Founded in 1988, Concord is a world-class financial technology company, delivering innovative, flexible, and scalable portfolio servicing solutions to meet the demands of loan originators and capital providers (and their customers) in multiple asset classes.]
Fintechs evaluating loan servicing and backup servicing will discover that the most critical criterion for success is customer service that permeates and drives every element of performance—from state-of-the-art technology and customer care to compliance and problem-solving. Zappos CEO Tony Hsieh sums it up succinctly: “We believe that customer service shouldn’t be just a department; it should be the entire company.”
Customer service should drive every part of a top-notch Fintech loan servicing and backup organization. Following are 10 top areas to address when reviewing options:
- Compliance. Compliance with local, state, federal and, sometimes even foreign, law is critical. Your servicer should be a subject matter expert in consumer communications, data safety and security and compliance-related regulation. Key questions to ask are: What is the servicer’s process for staying informed and educated on the law? How experienced is your servicer in dealing with consumer touchpoints/data addressing regulation restrictions? What is your servicer’s disaster recovery plan and testing frequency? In marketplace lending, how competent and flexible is the software platform in addressing everything from state-by-state usury and lending laws to changing strategy quickly when volatility/downturn call for it?
- Proactive Outreach. Your servicing company should be proactive versus reactive. Loan servicers paying full attention often will spot potential potholes or performance challenges before they ever materialize. Key questions: Does the servicer have the resources, experience, and commitment to provide redundant outreach via a relationship management team assigned specifically to a designated client? Is someone on that team always available to address concerns responsively and reliably? Is this level of service a standard part of the servicer’s contract or designated as an optional, extra cost?
- Customized Solutions. No Fintech company fits into “one size fits all.” Neither should your loan servicer. It should be about understanding your needs, requirements, and preferences first—then developing a tailor-made solution that fits like a glove. Does the loan servicer offer solutions that fit your portfolio or is your portfolio expected to fit into their pre-determined parameters? Does the level of customization apply to every aspect of the loan servicing agreement—from technology to alignment of corporate cultures?
- Comprehensive Technology Toolkit. This encompasses both established and emerging technology designed to meet today’s needs while planning for tomorrow’s. Your servicer needs to offer a robust program to create new, reliable technology solutions efficiently. Key questions: Is technology focused and created through a robust product development group that can meet client needs as well as their customer needs? Can the technology offer a system with a natural language, Google-like search way of gathering information, giving people the ability to answer questions themselves through true business intelligence instead of contacting IT?
- Scalability. Your servicer must be tuned in to rapid growth in your organization when it occurs. This includes dedicating ample resources, both on the people and technology sides of the equation. Key questions: Does your servicer assertively assess the need for a well-orchestrated scalability plan, so that needs are addressed before scaling occurs? How well does the scalability plan meet budget parameters and required performance thresholds? Does the plan enable agile incorporation of new features and functions, providing rolling upgrades that are implemented while everything continues to run?
- Transparency. Tell it like it is. And prove it. Period. There is a natural tendency to “embellish” performance abilities to get contracts. Key questions: What are a handful of real-life examples about telling the truth when conveying bad news? What do the loan servicer’s employees have to say about the culture of “transparency?”
- Team Longevity and Coordination. The length of time a loan servicing team has worked together is key to customer service excellence. A team that is experienced working together, has extensive company history, works seamlessly and competently together, and is motivated and happy translates into top-notch client support. Key questions: How long have employees been with the company, and in what capacities? Does the corporate culture encourage flexibility, a collegial atmosphere, and enjoyment while at work? Is the team comprised of a good mix of “people people” and “tech people,” able to communicate positively and knowledgeably with each other?
- Company Longevity. Length of time in business, coupled with reputation among existing clients, are time-honored indicators of how well the company will do going forward. Key questions: How long has your servicer or servicer prospect been in business? What is their reputation among existing clients? How do reviews substantiate performance? Does the servicer have a sizeable number of tenured people with relevant servicing experience? Are levels of lengthy company experience evident both at managerial and front-line employee levels?
- New Perspectives. Track record and longevity in today’s dynamic Fintech marketplace mean little if not accompanied by the ability to take a fresh look at looming challenges. Key questions: Does the servicer view you through a “fresh lens,” utilizing an extensive discovery process that includes anticipated stumbling blocks? Does the servicer do a deep dive to address future growth patterns in addition to present needs? Is the servicer set up to move efficiently when new challenges emerge at any level, from operations and communications to technology and security?
- Problem-Solving. Just about anyone can look good when all is well; it’s in the trenches where ultimate value is established. Key questions: What is the prospective loan servicer’s track record in preventing and addressing data breach issues, one of today’s most daunting and omnipresent threats? What protocols are in place for problem prevention in such critical areas as protecting loan performance when the economy falters? What systems are in place to aggressively and successfully deal with technology problems and setbacks?
Stellar customer service that permeates every aspect of Fintech loan servicing eliminates time-consuming and costly problems, and helps companies maintain positive relationships with their customers. For more information, download the Concord Servicing whitepaper.