7 ways to showcase your lending strengths

At a time of rising interest rates and growing economic uncertainty, Americans are motivated to find the credit option that fits them best.

The 2022 Vericast Financial Service TrendWatch report indicates that 86% of consumers are generally happy with their primary financial institution and get what they need from that relationship.

But the report also identifies two critical products that consumers are open to getting from a different financial institution: loans and credit cards.

When you factor in rising inflation, tight supply chains, expected rate hikes and the increased popularity of neobanks, particularly with millennials, it’s clear that competition for loans and credit will be fierce.

For these reasons, it’s more important than ever for financial institutions to be ready with relevant, personalized credit offers at the time people need them most. Here are some ways to prepare.

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Promote your rates and rewards. Interest rates have crept up and will continue to go higher. Make sure people are aware of your competitive rates and rewards by highlighting them in your marketing. While most people don’t think in percentages, try to spotlight their potential monthly payments for a fixed loan in your messaging, too. Restrictions or required disclosures may apply, so check with your legal or compliance department.

Target ‘in-market’ customers. If you intend to be competitive, strike while the iron is hot. You must reach prospects with your best offer precisely when they’re in the market for a loan or credit card. By anticipating the needs of your current customers, you position your preapproved offers top of mind, so they know you stand ready to serve them.

Offer multi-loan preapprovals to existing customers. Many people lack confidence in their ability to be approved for a loan nowadays. Alleviate their anxiety by providing preapprovals to your customers so that when they are in the market, they will come to you. Multichannel multi-loan preapprovals allow customers to access, review and accept multiple prescreened loan offers at every touch point, driving loyalty and revenue.

Adopt an always-on, omnichannel approach. Discover the importance of implementing an effective 24/7/365 strategy that puts loan offers at shoppers’ fingertips to accept anytime, anywhere. Communicating with consumers through multiple channels, including email, digital, mobile, direct mail and connected TV, is a proven method of increasing acquisition and driving revenue.

Set up an alerts program. Receive notifications from multiple credit bureaus whenever a credit inquiry is submitted for your customers. Using all three credit bureaus is best, according to Vericast client data, because it will provide 75% more coverage. Monitoring these inquiries and then countering with a quick, preapproved offer via the channel in which shoppers are most likely to respond will help you stay one step ahead of the competition and win market share.

Make loan shopping easy. Think like Amazon and keep it simple and easy. If it involves too many steps, requests too much information or takes too long, consumers will abandon the process. Take a cue from fintechs, which have gained favor by simplifying the loan application process.

Offer to help. Being proactive and reaching out to your customers sets you apart from other lenders by showing you care.

People are much more focused on rates and payments because of rising rates and growing economic uncertainties. In a time when every dollar counts, people are especially motivated to find the best option to help them provide financial security. Make your loan marketing proactive and clear, and your offers easily actionable.

In a perfect world, your customers would never even consider approaching a competing institution about a loan, and you’d have the resources to get in front of every prospect. But times have changed, and multiple channels and myriad borrowing options are now available.

But you can effectively compete for your share of loans with a seven-part strategy that puts consumers—and their financial well-being—at the center of your marketing efforts.

Stephenie Williams is vice president for financial institution product and strategy at Vericast.

Explore ways technology can help financial services providers reach the right customers with the right credit products and compete more effectively against nonbank players in the BAI Executive Report, “Technology is pushing lending in new directions.”