To ensure that loans are extended to people with the ability to repay, it is crucial to have updated, verified information about the applicants. Today loan frauds amount to over INR 64,000 Crores, Lenders are therefore reluctant to sanction loans to individuals without verifying their Income and Employment history.
Automated income and employment verification processes make significant transactions possible by ensuring efficient and error-free verification of employment data.
Verification of Income and Employment (VOIE), is essentially a way to ensure that the income and employment information the borrower provides is accurate.
Most lenders use VOIE to check the following factors:
Since VOIE is entirely user-consented, automated, and digitally verified, lenders can confidently extend their loans based on the borrower’s credit risk as ascertained by the VOIE process. Let's explore some of the benefits lenders get when they use payroll APIs for borrower verification
With rising competition, the automation of Income and Employment verification has become essential in the lending business. Due to the streamlined efficiency and accuracy of the automated process, both parties benefit in terms of saved time and resources.
Bankers or lenders can instantly verify borrower information and track application timelines using automated Payroll verification APIs. Automation of this data also ensures that the time saved can be devoted to other important tasks.
Low friction in the process also benefits the users by keeping them in the system and eliminates the possibility of any errors that might arise from manual data entry. Government agencies can also use this digitally verified data to expedite the approval of a government assistance application.
These factors ensure that the entire process remains smooth and hassle-free, improving user satisfaction and boosting business for lenders.
No lender wants to spend hours going back and forth verifying applicant data, as is the case in traditional verification processes. The lack of efficiency of the traditional verification processes leads to undue waste of time and resources for the banks or lenders.
Further, in traditional verification methods, lenders also have to face the challenge of dealing with a large number of unstructured documents, leading to ambiguity and confusion. This increases the risk of errors in the verification process.
Manual verification by humans may sometimes lead to some information being overlooked by the verifier. This could lead to inaccuracies in the data derived and renders the entire process invalid.
Automated income and employment verification APIs boost accuracy by over 50% by efficiently identifying and extracting critical information as per the process requirement.
The automated verification process ensures that all the data is correctly identified and the results derived are useful.
With the changing dynamics of the economy, budget cuts have become a frequent occurrence in most companies. The rising labor costs have led to it being one of the most expensive factors of production. Thus, it is important to reduce the unnecessary use of employees for jobs that can essentially be done by machines.
Traditional methods of income verification inevitably lead to delay and inaccuracy. The increased time required leads to unnecessary expenses in the process. Further, if the process is too costly, it will lead to delays and affect the ability of banks and lenders to retain their clients.
Automated payroll verification processes use intelligent OCR that assists lenders on various workflow stages like data filling. This ensures that the borrower is duly verified from authentic sources before a loan is approved which then reduces the risk of bad credit
Streamlining processes like Income and Employment verification, document processing, background checks, and underwriting lead to cost savings and ensure transparency which makes it easier to spot the problem points. However,
Owing to the use of valuable data, all verification processes must focus on ensuring data security. It involves protecting all employer-employee data with end-to-end protection to ensure that there is no data break.
Considering the complexity of the income and employment verification process, some companies seek to outsource it to third parties. In such cases, there are a few more questions that need to be kept in mind –
In the present world, time is of the essence. So, if the loan approval takes too long, consumers would inevitably choose a more efficient lender or bank. With income and employment verification APIs, the entire loan approval process can be streamlined for improved efficiency and accuracy.
The several benefits that automating your income and employment verification process brings, can give you a much-needed edge over your competitors. API-powered Payroll verification start-ups like Tartan use cutting-edge technology to ensure that transition to automated payroll verification remains smooth and hassle-free.
With the first-of-its-kind product offering in India and a feature-packed platform, Tartan’s demo session is worth giving a try. Our passionate commitment and rock-solid performance will make you stick to us forever.
Be first to get Tartan product updates and news