What role do digital lending platforms play in creating social justice?
On the sidelines of Iran Transaction Exhibition, Digipi held a specialized meeting on “Landscapes, Opportunities Ahead” with the participation of the directors of Bank Mellat, Tejarat Bank and Post Bank. In this session, on the impact of LandTech (Digital lending platformThe digital economy, the necessity or non-necessity of the activities of these emerging companies and the ways in which they interact with the financial regulator were discussed.
How does LandTech help the digital economy?
According to Zomit, حسین محمودی, The Director General of Bank Mellat’s Personal Banking Department, said that the most important responsibility that LandTeaks can have in the evolution of the digital economy is to help the banking network to cover it at the right point of need recognition.
Hamid Qitasvand, Director of Marketing and Market Development, Post Bank of Iran, said about the role of landlords:
Technology-based companies are supposed to facilitate something new at one point and make a connection; Landscapes do the same. In the digital economy, the approach is to collaborate, share resources, and connect all users for greater experience. Landscapes are the point at which small markets in the digital economy can provide banks and platforms as a financial infrastructure.
Noting that such communication is two-way, Gheitasvand defined the responsibility of these companies in terms of the penetration capacity they can create and access to less accessible areas to bridge the digital divide. He added that the supply chain complexity index has now increased, so landfills are needed to facilitate agility and speed.
In the following Hojjat MoghimiReferring to studies on the relationship between economic growth and the development of financial instruments, the head of Tejarat Bank’s product and business development department said:
The most important function of LandTeaks is to contribute to the effectiveness of traditional tools; The economy rotates with these tools. Landtech’s main job is to develop financial instruments. Another function is to drastically reduce the cost of financial transactions. In addition, it can provide control and control to the regulator. Given that about 70% of the banking system is in the field of lending and credit, the development of this field can not be ignored in any way.
Hooman Amini“E-commerce can help provide services that are traditionally available,” said the CEO of Digipi, referring to the help FinTech companies can bring to the country’s economy. Amini described LandTech’s contribution to the digital economy and e-commerce in such a way that, for example, FinTech can enable a user in remote parts of the country to access a product that is easily available to Tehran users, and LandTech also helps. In terms of economic conditions, it is possible to procure goods quickly.
لندتک; Necessity or choice?
Hossein Mahmoudi called the existence of landfills next to banks a necessity for banks and the people due to the problems of lending in the country. He said in this regard:
In order for a bank to be able to grant non-judgmental facilities (judging the granting of facilities in various circumstances) at a low interest rate, it must seek the help of technology and outsource the lending to other entities to a level of acceptable risk. These business partners can manage and drastically reduce heavy labor costs for the bank.
The Director General of Bank Mellat’s Personal Banking Department added that good credit can also help banks with the help of LandTeaks; Because the customer’s competence is more reliable than collateral and its correct diagnosis helps the country’s banking network a lot.
Hamid Gheitasvand further referred to the issue of financial inclusion in order to answer the necessity or inactivity of land taxes. The director of Marketing and Market Development Department of Post Bank of Iran said that the end user in the context of digital economy can access the services that exist in the capital, but can the bank with its current existence provide this coverage? Gheitasvand also raised the question of whether the bank can achieve its social responsibility and the competence of the people to provide facilities. As a result, he saw the need to work with LandTeaks as a necessity that all dynamic economies in the world have grown because of.
Hojjat Moghimi He pointed to the inability of the bank to provide services and the lack of time and agility in these institutions, which forces them to have business partners in various fields. Regarding LandTek’s assistance to banks, the CEO of Digipi noted the reduction of operating costs, the identification of consumption areas for better regulatory decision-making, and the help to automate processes and establish financial discipline by defining payment incentives.
According to Hooman Amini, banks have a lot of problems in the process of providing micro-facilities because it is highly judgmental and complex, while the bank does not know enough about the customer and only when the customer visits the branch, gets acquainted with him and validates him. However, the goal in the financial process is to provide facilities to customers at the best price and in the fastest time.
How Landtech interacts with banks
Managers of Bank Mellat, Tejarat Bank and Post Bank believe that customer behavior information is much more accurate and comprehensive with entities or platforms that have more customer relationships; This can strengthen banks in measuring the creditworthiness of bank customers to provide them with more facilities. The director of Marketing and Market Development Department of Post Bank of Iran, pointing out that smart allocation of facilities can create more accurate demand stimulation, said that the economy is alive with demand stimulation and if this demand stimulation is connected to the customer experience and becomes a virtual identity, it can Did better accreditation. Hamid Gheitasvand added:
The customer receives credit based on merit, but there is a variety of customers, and the regulator must formulate lending rules based on this diversity and the segmented market. Credit transfer, monitoring and management should be more powerful and as a result we should have more accurate data. In fact, the bank is the interface between the regulator and the fintechs.
The Director General of Bank Mellat’s Personal Banking Department adds to these statements that the Central Bank intends to observe social justice in the allocation of credit and not to spend credit in commercial ways; So when the customer needs are properly identified with the help of LandTech, this process is provided to the regulator to meet his expectations regarding credit health, social justice and customer experience management and ensuring that facilities are provided in the right place.
The CEO of DJP describes how LandTech learns and uses these methods with a sandbox. Hooman Amini said in this regard:
When we want to create a new entity in the laboratory space, we either make instructions with the assumptions or we have to test it in experimental courses. The central bank is starting to do this now and is doing so in the RegTech subsidiary to optimize legislation using technology.
Regarding the sandboxing of processes, Amini says that the central bank should allow the operational environment in relation to banks to be tested in order to identify new identities, ie customers with different behaviors, pricing and availability of resources, etc., and so-called sandboxing. He adds that after this, there is an opportunity to classify the different personalities of users and to legislate for them with a more conscious knowledge. In general, he described such a process as completely interactive.
The effect of social behaviors on digital ranking
Scoring, validation or ranking of the customer is based on his financial behavior. However, other forms of validation are now gaining popularity around the world; Forms that examine customer behavior not only in banking, but also in various situations such as travel time payments, shopping and social behaviors such as paying taxes and so on. The managers of Bank Mellat, Tejarat Bank and Post Bank have a favorable opinion about this new style of accreditation, which is done with the help of Fintech companies, and say that this behavioral sharing and modeling of customer behavior is beneficial for the economy.
CEO of DJP: Accreditation of gray people, such as minors or out of the ordinary classifications, creates financial learning
In fact, traditional accreditation faces the problem of lack of past financial information of customers. In the digital age, a person under the age of 18 who is not yet legally able to open a bank account may earn money through social media or other digital monetization methods such as programming and education, etc. He reaches legal age, is not registered anywhere and is not given credit. Describing this situation, Hooman Amini says that the issue of “financial learning” has not been thought about much in our country, and naturally, traditional banking scoring methods are not ready to accept this person from the customer and this part of society; FinTech, meanwhile, lends credibility to such users so that traditional and modern credentials can work together to achieve financial inclusion.
Hossein Mahmoudi, director general of Bank Mellat’s personal banking department, said that the central bank had recently given more importance to scoring than collateral, adding that proper credit problems had caused banks to resort to collateral, while they themselves welcomed credit. Mahmoudi stressed that for the past few years, only one accreditation organization has been operating in the country, but if other institutions are activated in this regard, there will be competition that will improve their performance. According to him, the central bank should provide conditions in a competitive process that can be trusted with the help of companies and institutions of accreditation, the background and behavior of the microcredit applicant.
The Director General of Bank Mellat’s Personal Banking Department also pointed out that even in the collateral system, it is possible to do better, saying that collateral can be shared so that more credits can be received with it. The director of the Marketing and Market Development Department of Post Bank of Iran also added in this regard that people who want to receive credit and facilities in a remote village, due to the problems of collateral, experience social deprivation unjustly. “Matching documents with credit needs, especially in disadvantaged areas, and digitizing documents is a requirement that landfills can be effective in fulfilling,” he said.
On the other hand, Tejarat Bank’s product and business development department pointed out the bank’s problem in not having proper information from customers, which forces it to receive collateral. However, according to him, new assets such as the number of followers in virtual networks have been introduced, which can be used to give people financial credit, and only need to formulate the rules.
Finally, Hooman Amini, CEO of DJP, said about the new validation methods:
I believe that the more specialized we are in identifying customer needs and having simple rules to solve problems, the lower the cost of providing services. If we block a 100 million document for a credit of 10 million Tomans, we will take the opportunity to turn the document into several credits and to be able to increase the credit of the person and make his life easier. Businesses face the same problem, how many types of collateral can they use? Platforms can help streamline this process.
Noting that banks do not have access to the trust cycle, Amini says that due to the lack of appropriate tools, we have not been able to create financial inclusion in the country; However, banks can assess the credit risk of customers by creating methods according to the different personalities of users and spend their resources sufficiently to give credit to customers. The CEO of Digipi adds that LandTeaks can improve a person’s credit when it is recorded incorrectly low, and also encourage the uninformed customer to the country’s credit system to become a better customer in the digital ecosystem.