1️⃣ Featured Insight - Digital Customer Journeys - 5 Best Practices Customer journeys are going digital. However, digital journeys need to be designed properly in order to get the maximum business benefit out of it. Here are 5 best practices when designing digital lending journeys: 💡 Create Mockups Creating a mockup (clickable if possible) is essential to ensure that everyone is on the same page regarding the exact flow of the digital lending journey. You can use tools like  Figma ,  Miro , or the good old  Draw.io . Involve all key stakeholders teams like business, credit, operations, compliance right from the start. Also keep target device in mind - is the journey primarily going to be done on Mobile or Desktop? 💡 Build Cohort based Sub-Journeys One customer journey won't fit all use cases. Better is to design separate sub-journeys for different cohorts e.g. bureau based program, banking program, pre-approved customer base program etc. This will allow you to ensure that journeys are smart and adaptive to the actual business requirements. 💡 Handle Unhappy Flows Many times we end up taking care of happy flows e.g. customer finishes video KYC. But what should the digital system do for the real world scenarios? E.g. customer drops out or enters a wrong identifier? Remember, for every way of doing something correctly, there are more than one ways to do it wrongly. And the system should anticipate and handle for such situations. 💡 Keep Fallback Vendors Wherever you use external vendors, prepare for downtime. When the vendor service is down or it fails, system should automatically switch over to a backup vendor. E.g. PAN verification, bureau pull, SMS etc. If this is not done, a single vendor's downtime can bring your business to a halt. Imagine if that happens on a month-end! 💡   Assisted vs DIY An important aspect to decide is if the journey will be done directly by end customer or in an assisted mode. Assisted mode can make more sense for situations where there is B2B2C setup (e.g. counselor onboarding education loan) or larger ticket size (e.g. business loan onboarding by an RM) or if the journey involves lot of steps. Whereas a journey like personal loan may be better handled by customer directly in a DIY setup. 2️⃣ Industry News Roundup 🗓️  RBI releases list of 15 Upper Layer NBFCs [ Reference ] 🗓️   MobiKwik, Cred join hands with RBI to fully launch CBDC (e₹) for Android; check features, usage [ Reference ] 3️⃣ Stats of the Week 📊 NBFC SME Loans may grow 22-24% in near term. But asset quality headwinds remain. Smaller players may see credit loss of 4-6%: ICRA [ Reference ] 📊  India Fintech Market to Skyrocket, Reaching $769.5 Bn by 2031 [ Reference ] Want to get weekly content regarding new developments in banking technology? Subscribe to our newsletter  here . Are you a CXO at a bank / NBFC / fintech company interested in upgrading your technology? We would love to show you a demo of the OneFin offering. We provide end to end capabilities including configurable modules like LOS, LMS , Accounting System, Collection System, Digital Journeys etc. Schedule a Demo  here . Banking Technology Insights - Digital Customer Journeys, eRupee for Android & more Linkedin Post - https://www.linkedin.com/pulse/banking-technology-insights-digital-customer-journeys-erupee-idn8c/

1️⃣  Featured Insight - UCRF Format based bureau reporting now mandatory. RBI has been doing many reforms on the credit reporting space over the last year or so. It has all culminated in the master directions which were released on 6th Jan 2025 [ Reference ]. There have been some sweeping changes in how bureau reporting has to be done. The credit information companies (CICs) have been processing the regulations, and now are asking FIs to submit data in the UCRF (Unified Credit Reporting Format) format only. Below is everything you need to know about it:  💡Learn About UCRF / TUDF format UCRF format is the same as TUDF format. TUDF (Trans Union Data Format) is a text based format (not excel or csv based) developed by CIBIL bureau, with the new RBI guidelines, it is renamed to UCRF format. This change brings consumer bureau reporting in line with respect to the commercial bureau reporting which was already a non excel based text format. Ideal implementation in your systems would be to create a converter from excel to UCRF format, so that any manual edits etc. can be converted to TUDF format. Consumer bureau reporting has to be done every 15 days, on the 15th and the last day of the month, so system development is a must for UCRF format. It is not a human readable format, so it cannot really be created by hand. 💡Commercial Bureau Reporting Co applicants or Relationship Segments are mandatory for doing bureau reporting. [ Reference ]  The Relationship Segment (RS) within the Commercial Bureau format captures data on corporate relationships, including business category and relationship type (e.g. directors, shareholders, proprietors, partners, trustees, holding companies, subsidiary companies and associated companies).  The “tap” format used for commercial bureau reporting is also not a human readable format, so it must be generated by system, as it is not really feasible to generate it by hand. 💡Ensuring Data Quality while doing submissions The new RBI guidelines ask CICs to maintain a Data Quality Index for each FI. It means, a bare minimum reporting is not enough, and each FI should strive to have a high data quality. RBI will monitor the same with respect to the industry wide averages. DQI guidelines are available for consumer bureau reporting  here . They are available for commercial bureau reporting  here . Typically, FIs face problems while maintaining high DQI in commercial bureau reporting, as many fields end up getting reported as “others”. The best way to handle this is to ensure that all fields which are considered in DQI must be taken as inputs. 2️⃣  Industry News Roundup 🗓️ Kinara Capital breaches loan covenants. [ Reference ] 🗓️ RBI released draft circular on charging of foreclosures charges. These are some borrower friendly norms which will impact how foreclosure charges are charged to customers by banks and NBFCs. [ Reference ] 3️⃣  Stats of the week 📊Bank lending to NBFCs saw a significant slowdown in 2024, increasing by only 6.7% to reach Rs 16.22 lakh crore as of December. This is a marked contrast to the 15% growth rate observed in 2023, and represents the slowest growth rate in four years. 📊 The Reserve Bank of India's quarterly data revealed that the annual growth rate for the personal loan segment decreased to 13.7% at the end of December 2024, compared to 15.2% at the end of September. This moderation in personal loan growth during the quarter ending in December followed regulatory cautions about potential overheating in the market. Want to get weekly content regarding new developments in banking technology? Subscribe to our newsletter  here . Are you a CXO at a bank / NBFC / fintech company interested in upgrading your technology? We would love to show you a demo of the OneFin offering. We provide end to end capabilities including configurable modules like LOS, LMS , Accounting System, Collection System, Digital Journeys etc. Schedule a Demo  here . #banking #bfsi #fintech #nbfc #los #lms #loanmanagementsystem

1️⃣ Featured Insight -  Audit Trails in LOS & LMS Systems Implementing robust audit trails within Loan Origination Systems (LOS) and Loan Management Systems (LMS) is crucial for ensuring transparency, accountability, and regulatory compliance in India's lending sector. An audit trail meticulously records every transaction and modification, detailing who made changes, what information was altered, when it occurred, and the previous values. This comprehensive tracking not only deters malpractices but also aids in identifying the root causes of discrepancies, thereby enhancing the integrity of financial operations. Significance of Audit Trails in LOS and LMS 💡Enhancing Transparency and Accountability Audit trails provide a chronological record of all activities within LOS and LMS platforms. By documenting user actions, these trails ensure that every modification is traceable to an individual, fostering a culture of accountability. This transparency is vital for maintaining trust among stakeholders, including customers, regulators, and financial institutions. 💡Deterrence of Fraudulent Activities  The presence of an immutable audit trail acts as a deterrent to potential fraudulent activities. When individuals are aware that their actions are being recorded and can be scrutinized, they are less likely to engage in unethical behavior. This preventive measure is essential in safeguarding the institution's assets and reputation. 💡Facilitating Root Cause Analysis  In instances where discrepancies arise, such as mismatches between reports, audit trails enable swift identification of the underlying issues. For example, if two reports differ, the audit trail can reveal whether data was altered between the generation of these reports, allowing for prompt corrective actions. Regulatory Framework and RBI Guidelines The Reserve Bank of India (RBI) has underscored the importance of audit trails in digital lending platforms to enhance data security and borrower protection. According to the RBI's digital lending guidelines, data collection by digital lending applications should be need-based, have clear audit trails, and be conducted only with the prior explicit consent of the borrower. Furthermore, the Ministry of Corporate Affairs in India has mandated that, effective from April 1, 2023, all companies must implement software that records an audit trail for every transaction. This includes creating an edit log for each change made in electronically maintained books of account, capturing the date of such modifications. The audit trail must always be enabled and should not be tampered with, ensuring the integrity and reliability of financial records. Best Practices for Implementing Audit Trails in LOS and LMS for Banks & NBFCs Comprehensive Data Recording Ensure that the audit trail captures all pertinent details of each transaction, including user identification, timestamps, nature of changes, and previous and new values. This comprehensive data collection is vital for accurate monitoring and analysis. Real-Time Monitoring and Alerts Implement real-time monitoring systems that can promptly detect unauthorized or suspicious activities. Automated alerts should be configured to notify administrators of potential security breaches or policy violations, enabling swift responses to mitigate risks. Secure and Tamper-Proof Storage Store audit logs in a secure, tamper-proof environment to prevent unauthorized access or alterations. Utilizing encryption and access controls ensures that only authorized personnel can view or manage these logs, maintaining their integrity. Regular Audits and Reviews Conduct periodic audits of the audit trails to verify compliance with internal policies and regulatory requirements. Regular reviews help identify patterns or anomalies that may indicate fraudulent activities or system inefficiencies. User Training and Awareness Educate employees about the significance of audit trails and the institution's commitment to monitoring all activities. Awareness programs can deter malicious actions and promote adherence to ethical standards and procedures. Integration with Compliance Management Systems Integrate audit trail functionalities with broader compliance management systems to ensure seamless adherence to regulatory standards. This integration facilitates automated reporting and simplifies the compliance verification process. Challenges and Considerations Data Volume and Management The extensive data generated by audit trails can be overwhelming, necessitating efficient data management strategies. Implementing scalable storage solutions and data analytics tools can help manage and interpret large volumes of audit data effectively. Performance Impact Continuous logging of activities may impact system performance. Optimizing system architecture and employing efficient logging mechanisms are essential to balance performance with comprehensive monitoring. Privacy Concerns While audit trails enhance security, they must be designed to respect user privacy. Collecting only necessary data and ensuring compliance with data protection laws are crucial to maintain trust and avoid legal repercussions. Cost Implications Implementing and maintaining robust audit trail systems can be resource intensive. However, the benefits of enhanced security, compliance, and operational efficiency often outweigh these costs, making it a worthwhile investment. Conclusion Incorporating comprehensive audit trails into Loan Origination and Loan Management Systems is imperative for fostering a secure, transparent, and compliant lending environment in India. By adhering to regulatory guidelines and implementing best practices, financial institutions can not only protect themselves against fraud and operational inefficiencies but also build trust with borrowers and regulators alike. As the digital lending landscape continues to evolve, the significance of robust audit trails will only become more pronounced, serving as a cornerstone of integrity and accountability in financial operations. 2️⃣ Industry News Roundup 🗓️ Google building digital agri stack for India using satellite data. This will facilitate subsidy payments, agriculture loans & more [ Reference ] 🗓️ ET BFSI CIO Conclave will happen on 7th March at Sahara Star, Mumbai [ Reference ] ▶️The Bold Journey Of Mobikwik, India's Fintech Pioneers -  Watch Video 3️⃣ Stats of the week 📊 Treasure Trove on Data related to Indian Economy - Indus Valley Report by Blume.  This annual report by reputed Blume Ventures has gone viral.  It does a deep data driven analysis on all important aspects related to Indian economy, including startups, innovation, SME IPOs & much more [ Reference ] Want to get weekly content regarding new developments in banking technology? Subscribe to our newsletter  here . Are you a CXO at a bank / NBFC / fintech company interested in upgrading your technology? We would love to show you a demo of the OneFin offering. We provide end to end capabilities including configurable modules like LOS, LMS, Accounting System, Collection System, Digital Journeys etc. Schedule a Demo  here . #banking #bfsi #fintech #nbfc #los #lms

1️⃣ Featured Insight - Banking Technology Insights - Self-Serve Customer Portal for Banks & NBFCs  Does a bank or an NBFC need to give a Self-Serve login portal for its customers? It is strongly recommended to do the same, even if the customer set is sourced under a B2B2C or partnership model. Here are 5 advantages of providing a Self-Serve login portal to customers: ✅ Automatically handle routine customer queries - many customer queries like need for SOA, access loan documents, request loan closure letter, information on amount payable etc can be provided in the self-serve portal. This will reduce amount of time your team spends on routine customer support ✅ Keep KYC updated - as per RBI guidelines, regulated entities need to keep KYC details like address updated periodically. The self-serve portal can serve as a way to periodically update information. Customer can be asked if their details have changed, and if so, their KYC update can be done on the portal. There can be a duration after which re-KYC is mandated by the system. ✅ Grievance management - the portal can also serve as a way for customer to raise a grievance request. This can link to your backend CRM or LMS for resolution of the grievance in an auditable manner. Details of customer support or RM can also be provided inside the customer portal. ✅ Payment options - you can also provide option to customers to make payment directly in the portal. ✅ Legacy customers management - there may be legacy loans that may have been sourced by a business correspondent, or it may correspond to a portfolio that you bought over. The portal can help customers of these loans also remain in touch with you. 2️⃣ Industry News Roundup 🗓️   Indian Bank and IIT-M to hold cybersecurity, fintech hackathon in April. The upcoming hackathon will center on critical issues in the FinTech sector and advanced fraud detection mechanisms within the cybersecurity domain. [ Reference ] 🗓️ RBI allows small finance banks to offer credit lines via UPI. Until now, UPI transactions were limited to savings accounts, overdrafts, prepaid wallets, and credit cards. With this update, individuals can also link pre-approved credit lines as a payment source. [ Reference , RBI Reference ] 🗓️  RBI to launch ' bank.in ' and ' fin.in ' domains for Banks & NBFCs respectively. This will help consumers identify which bank / NBFC website is legitimate and which is fake. [ Reference ] 3️⃣ Fintech Article of the Week 📊  Use of Generative AI in Credit Assessment - An Insightful Article by CRISIL. Generative artificial intelligence (GenAI) is disrupting business-as-usual worldwide. Read this article to see how it may affect the credit assessment processes followed by lenders.  [ Reference ] Want to get weekly content regarding new developments in banking technology? Subscribe to our newsletter  here . Are you a CXO at a bank / NBFC / fintech company interested in upgrading your technology? We would love to show you a demo of the OneFin offering. We provide end to end capabilities including configurable modules like LOS, LMS, Accounting System, Collection System, Digital Journeys etc. Schedule a Demo  here . #banking #bfsi #fintech #nbfc #los #lms #loanmanagementsystem