Nowadays we can see a trend towards the digitalization of MFI business processes. Large market players create websites, mobile applications, chatbots in instant messengers, where “robots” algorithms serve potential customer loans and processing loan approval automatically. How beneficial are bots to business owners? What processes can be automated and what can be delegated to chatbots for granting loans? This article will help answer all your questions.
- 1 Trends and summary of the situation on the CIS MFI market
- 2 What is loan bots
- 3 Microcredit Automation Tasks
- 4 Examples of loan bots
- 5 Loan chatbot in Viber
- 6 Bot for loans in Telegram and Viber
- 7 Bot to pay for loans
- 8 Why choose bots?
- 9 Potential chatbots for MFIs in messengers
- 10 Chatbot for MFI development
Trends and summary of the situation on the CIS MFI market
MFI business in Russia and the CIS continues to gain momentum. According to the forecast of the Expert RA Rating Agency, which conducted a research based on 71 microfinance organizations, in 2020 the growth rate of loans issued shows steady growth – up to 20%, and the volume of loans issued will reach 494 billion rubles, compared to 412 billion rubles of the previous 2019 year.
Legislation limitations led to the MFIs before the pay-day microloan segment business models adaptation focused on diversification of the service portfolio. The changes regarding user identification have benefited the development of online business. In Russia, in 2019, amendments were made to 115 Federal Laws of Russia regarding the simplified identification of users by name and phone number for amounts up to 15 thousand rubles.
In Ukraine, according to the resource of Minfinmedia, today there are 77 microfinance organizations. According to the National Commission, the microcredit market in Ukraine has been growing rapidly for several years. In the 3rd quarter of 2019, compared to the same period of the previous year, the growth in lending amounted to 57%. And the volume of micro-loans issued is almost 40 billion UAH, with the number of online contracts at 10 million.
As for legislation in Ukraine, in 2020 amendments were made to the Law of Ukraine “On acquiring legal protection (income) for income earned by a wicked gentry, financing of terrorism and financing of mass entertainment.” And also on July 1, 2020, it comes into force the law that allows reducing the number of regulatory institutions and simplifying the licensing of MFIs, while bringing the supervision of the activities of the non-banking sector closer to international standards.
In Belarus, according to the National Bank of the Republic of Belarus, 86 MFIs are registered today. During an online briefing on April 24, 2020, Dmitry Nabzdoro, head of the main department for regulating non-credit financial institutions of the National Bank, announced that the National Bank of Belarus predicts a microfinance market growth of at least 1.5 times in 2020.
What is loan bots
Today, one of the most effective sales tools for MFIs is a loan bot.
Loan bots are remote online services that offer you to arrange loans to paychecks directly through a social network or messenger platform. MFI loans are issued after analysis of the creditworthiness of the client, after which they declare the possibility of transferring money by any means, instant processing. Loan bots are not tied to a specific MFI and act as aggregators of online loans of various organizations.
The advantages of loan selection services include:
- Presence of several loan processing options in different microfinance organizations
- Bot development takes several months
- Fast and simple for the client. You do not need to independently search the Internet for MFIs that offer remote loans on the card. The loan bot will immediately send a link to the online application
Microcredit Automation Tasks
Loan bots – automated MFI employees in messengers to work with potential clients. On the business side, the loan to the bot is delegated:
- identification of needs and assistance in choosing a loan product in a dialogue format.
- landing on a customer loan product
- application for a loan and accompanying documents
- making decisions on issuing and informing about a client’s decision
- customer support through notifications and feedback
Examples of loan bots
There are several types of loan bots:
- Loan bots on websites – zaimitut.ru, lendprofi.com, repayza.com
- Loan bots in messengers:
- VK – zaim_bot, zaembot
- Telegram – @webbankirbot_bot, @alica_zaim_bot, @thirdparty_pay_moneyveo_bot
- Viber – webbankir, a bot from Quick Money
ZaimBot in Vkontakte
A prominent representative of loan bots in VK is the ZaimBot group. The group has more than 29 thousand subscribers and offers to arrange a loan in a matter of minutes. A loan bot in VK works like this: the client writes any word in the group’s drugs, then the potential borrower is redirected to the application form on the microfinance organization’s website via a direct link to fill in the questionnaire on the microfinance organization website. From the point of view of doing business, VK is an interesting platform for creating a bot for loans, but there is a risk of being blocked as some large bots with thousands of subscribers were blocked: Zanimayka, Zayminator, Approver, etc.
Loan chatbot in Viber
The chatbot in Viber for the MFI “Bystrodengi” was created to promptly advise borrowers on the most popular and simple issues. Potential borrowers in it:
- the nuances of applying for a microloan
- rules for granting a loan at a certain rate.
Bot for loans in Telegram and Viber
The most digitized loan service is webbankir. In 2017, they were the first MFIs in Russia to launch bots on Viber and Telegram. According to the General Director of the company Andrei Ponomarev, the development of the chatbot took two months and allowed:
- hold over 1 million sessions in half a year for nearly a quarter of a million users
- process 40% more calls than other communication channels combined (phone calls, e-mail, Skype). The bot reduced the load on the call center by 1.5 times and helped increase the processing speed of incoming calls.
- process more than 1,500 calls in a month and a half, saving more than 250 hours of working time
Bot to pay for loans
In 2020, the financial assistance service Moneyveo launched a chatbot to pay for loans through instant messengers. The purpose of this bot is to pay a loan in a few clicks from a convenient messenger.
Why choose bots?
Above, we looked at examples of bots made for a specific purpose – 24-on-7 counseling, loan repayments, an aggregator of offers for clients. However, this is not the entire list of tasks that chatbot for business can help:
- To Identify needs and assistance in choosing a loan product in the format dialogue.
- To land on a client’s loan product inside the messenger with secure identification
- Application for a loan and accompanying documents
- Making a decision on issuing and informing about a client’s decision
- Conclusion of an agreement
- Application Monitoring
- Customer support through notifications
Identification of needs and assistance in choosing and landing on a loan product in the messenger, implemented by the built-in browser function, eliminates customer distraction for advertising or remarketing of other products, leaving only credit products of the business in focus. An added benefit is that recording customer history dialogs can be used to improve scoring models.
The application, the decision to issue and the conclusion of the contract are held according to a standardized process that excludes the human factor, as well as accelerating the process by automatically receiving data on the client’s credit history.
Monitoring the implementation of the application and accompanying the application allows you to introduce the client to new profitable offers.
Re-sales are possible due to personalization of offers, based on data previously left by the user.
Referral programs allow, due to the convenience of messenger platforms for communication, in two clicks to share an interesting offer with any contact of the smartphone’s address book
Potential chatbots for MFIs in messengers
Among the main advantages and possible prospects of developing bots for MFIs:
- the quick landing of new customers – the start of work does not require installation of applications (WhatsApp, Facebook Messenger, Telegram and other messenger applications are already installed on the smartphones of your potential customers)
- low cost of scaling and automation of lending services in comparison with the cost of hiring and training employees.
- customer engagement through instant notifications, interactive features for gamification
- access to the address book in the messenger for referral programs in order to expand the client base
- fast chatbot development speed and quick ability to implement updates and add new features
According to the market situation and the experience of our clients – microfinance organizations, we at Chatbots.Studio are convinced chatbots for MFIs in messengers simplify microcredit business processes and allow companies to reduce the cost of processing routine operations. Earlier, we examined the place and role of chatbots in Internet banking.
Chatbot for MFI development
Chatbots.Studio is a leader in developing bots for the bank. We will provide you with detailed information on how your financial institution can get more customers using the chatbot in the messenger and solutions for their servicing without the need for the client to leave the messenger convenient to him.