How Vancity Uses Artificial Intelligence to Enhance the SMB Member Experience

The landscape of lending is changing, and so are the expectations of consumers.

Challenge

Today’s members expect easily accessible, quick services and they will switch their primary financial institution for access to products online[1].  Vancity knew its members were no exception, so it set out to meet the increasing member demand for omni-channel, accessible, convenient services in order to better serve small and medium businesses (SMBs) in their community.

It’s no secret that SMBs have a hard time getting quick access to capital from financial institutions paired with great advice. For a small business owner, the process of applying for a loan is time consuming and complicated, requiring the applicant to take valuable time out of running their business to apply for the loan.  

Vancity recognized that they could improve on the speed of their loan adjudication process, which was largely manual. The lending team at Vancity also wanted to spend less time on administrative tasks that could be automated, and more time providing superior member service and advice.

Vancity partnered with a local FinTech to digitize its loan origination process.

Solution

JUDI.AI, the Vancouver based FinTech with a customizable, AI driven, loan adjudication platform allows financial institutions to create the ultimate member experience by providing members with instant decisioning on their SMB loan applications through JUDI’s proprietary AI Adjudicator™.

The team at JUDI.AI sat down with Vancity to understand Vancity’s objectives, and the parameters of its lending products. Since AI Adjudicator™ is configurable to any financial institution’s credit models, risk policies and best practices, Vancity had to decide how it wanted its lending products configured. Vancity was able to customize everything from which type of lending product it wanted to offer, the min/max loan amount of the product, payment frequency, the terms (months or years), and everything in between.

A six-month pilot project included a standalone instance of the platform with no integrations to existing technology in order to minimize the time and cost of the pilot. After the two month setup process, the platform was soft launched to selected account managers and small business members and gradually rolled out.  Vancity’s member focused philosophy resulted in the member experience being a key element to assess the impact of the AI Adjudicator™.

Vancity conducted research with members and staff on their experience.

Results

Member satisfaction with the AI Adjudicator™ was high due to the ease of the online application process, short time commitment (7-10 minutes) and instant decision. Members also appreciate the quality advice they receive from Vancity’s account managers. Even members who were not approved for a loan still held high levels of satisfaction due to the timeliness of the decision, transparent feed back on why they did not qualify, the advice provided by Vancity’s account managers, and the ability to move forward with business decisions.

“We did research with our members after the pilot and found a high level of satisfaction due to the speed and ease of use. Even those turned down for their loan were satisfied because they found out right away.” – Arak Bhokanandh, Director – Member Solutions and Digital Strategic Partnerships

Staff satisfaction was also high as employees appreciated the ability to automate time-consuming, back end processes. In 2018 Vancity saved its small business lending team more than 350 staff hours. Previously dominated by paperwork, these hours are now focused on the member, allowing staff to do more site visits, get to know members better and create additional capacity.

“The platform is really easy to use. It streamlines my job, allowing me to provide higher value services to our SMB members.” – Mike Harris, Small Business Lead

About Vancity:

With $26.4 billion in assets plus assets under administration, Vancity is one of Canada’s largest community credit unions. Vancity uses its assets to improve the financial well-being of its members, while helping develop healthy communities that are socially, economically and environmentally sustainable. Community business opportunities are one of Vancity’s key strategic priorities whereby there is a mandate to support small business owners and solo-entrepreneurs in areas such as day-to-day banking, access to credit, and health benefits.

[1]  70% of small businesses would change primary banks for digital access to products. Source: Gartner, 2017 Digital BankingReport.